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Red Stapler Company has a balance sheet which lists $85 million in assets, $40 million in liabilities, and $45 million in common shareholders' equity. It has 1,400,000 common shares outstanding. The replacement cost of the assets is $115 million. The market share price is $90. What is Red Stapler's book value per share

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Tundexi

Red Stapler's book value per share will be $32.14.

The book value per share means the equity available to common shareholders over number of outstanding shares.

  • The formula to use to derive the book value per share is {Total common shareholders' equity / Number of common shares outstanding}

Book value per share = $45,000,000 / $1,400,000 Common Shares

Book value per share = $32.1428571  per share

Book value per share = $32.14 per share

Therefore, Red Stapler's book value per share will be $32.14.

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