Determining the book value per share of firm


1) Mesmer Analytic, biotechnology firm, floated the initial public offering of= 2,000,000 shares at price of= $5.00 per share. Firm's owner/managers held 60% of company's $1.00 par value authorized and issued stock following public offering. One month after IPO, firm's board of directors declared a one-time dividend of $0.50 per share payable to all stockholders, meaning that owner/managers would receive the immediate dividend, in part out of pockets of new public stockholders. Determine the book value per share of firm before and after special dividend was paid?

a) $2.60; $2.10
b) $2.60; $2.60
c) $2.60; $2.30
d) $1.60; $1.10
e) $1.60; $1.00

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Finance Basics: Determining the book value per share of firm
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