JAMB Accounting 2015 Objective — Question 41

Question 41 of 50 from the Joint Admissions and Matriculation Board (JAMB) Accounting 2015 Objective paper, with the correct answer and a full explanation.

Granada Corporation has net assets of ₦600,000 and contributed capital of ₦180,000. The corporation has 30,000 shares of common stock outstanding with no preferred stock. This suggests that the corporation has

A. a book value of ₦4 per share
B. a book value of ₦20 per shareCorrect
C. a deficit of ₦420,000
D. retained earnings of ₦600,000

Explanation

Book value per share = shareholders' equity (net assets) / number of outstanding shares = 600,000/30,000 = ₦20 per share.

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