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10 October, 08:26

Digby's balance sheet has $85,185,000 in equity. Further, the company is expecting net income of 3,000,000 next year, and also expecting to issue $4,000,000 in new stock. If there are no dividends paid what will beDigby's book value?

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  1. 10 October, 10:30
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    Digby's Book Value: $

    Book value of existing equity 85,185,000

    Book value of additional equity 4,000,000

    Net income 3,000,000

    Digby's total book value 92,185,000

    Explanation:

    The book value of Digby is the aggregate of book value of existing equity, book value of additional equity issued and net income.
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