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Search Te × e Problem 1 x search Te x Search Te x (-C ezto.mheducation.com/hm.tpx connect. ACC 3021- Intermediate Accounting IE 171 ACC 3021- Sec TR2 UNTING Final Exam (ACC 3020 Question 210:00 21. The foliowing partial Information is token from the comparative balance sheet of Levi Corporation shares ssued and 23 mition shares outstanding at 12/JV2016, and and shares outsanding at 12/3/2015 $140 milion $115 millon million shares at 12/31/2015 (70 million) (48 milion what was the average price (rounded to the nearest dollar) ofthe additional shares issued by n 2016? $28 per share. O Cannot be determined from the given information $41 per share. O $5 per shareExplanation / Answer
Total number of shares issued on 12/31/2016 = 28 million
Total number of shares issued on 12/31/2015
= Value of common stock issued/Par value
= $115 million/$5
= 23 million
Therefore,
Number of shares issued during 2016 = 28 million - 23 million = 5 million
Now calculate the increase in the total balance of common stock and additional paid in capital on common stock during 2016.
Total common stock and additional paid in capital on common stock for 2016 = $140 + $520 = $660 million
And,
Total common stock and additional paid in capital on common stock for 2015 = $115 + $403 = $518 million
Therefore,
Increase in total balance of common stock and additional paid in capital on common stock during 2016
= $660 million - $518 million
= $142 million
Now calculate the average price of the additional shares issued in 2016 by dividing the increase in total balance of common stock and additional paid in capital on common stock by the number of shares issued during 2016.
Average price = $142 million/5 million = $28.40 per share
The average price per share calculated above is closest to the first option that is $28 per share.
Thus, the correct answer is $28 per share.
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