BOOK VALUE PER

SHARE
PRESENTED BY:
GROUP 3 AND GROUP 4
 Book Value per share
It compares the amount of
stockholders' equity to the number of
shares outstanding. If the market
value per share is lower than the
book value per share, then the stock
price may be undervalued.
FORMULA:
 ILLUSTATION:
The Share holder's equity in the statement of
financial position on Dec 31, 2015:

Share Capital P 5,000,000

(P 100 Par, 50,000 Shares)
Share Premium 1,000,000
Retained Earnings 2,000,000
Revaluation Surplus 1,500,000
Total Shareholder's Equity
9,500,000

= 190 Per Share

 PREFERENCE SHARE (Preferred
Share)
Its shares of a companys stock with
dividends that are paid out to
shareholders before common
stock dividendsare issued.
 Liquidation Value of Preference
Share
Liquidation Value is the amount
which preference shareholders
normally receive upon the liquidation
of the corporation.

Liquidation Value may be more than

PAR VALUE.
 Preference as to assets
The preference shareholders are entitled to
payment not only for the liquidation value
but also or dividends in arears.

(Dividends in arrears are fully Payable)

 Preference as to dividends
Preference as to dividends
Does not mean that the preference
shareholder have absolute right to
dividends.

Preference Share as to DIVIDENDS:

-Non-cumulative
-Cumulative
-Non-participating
-Participating
Preference as to
dividends
Non-cumulative Preference Share
This is the right to receive dividends
is forfeited in an one year in which
dividends are NOT DECLARED but
only entitled to CURRENT YEAR
dividends.
 Cumulative Preference Share
Undeclared dividends accumulative
each until paid.

Its entitled to all dividends areas.

 Non-participating Preference
Share
This entitled to receive ONLY the
dividends equal to fixed rated.
 Participating Preference Share
This is entitled to receive dividends
equal in excess of the basic or fixed
right.
PREFERENCE SHARE
CASES 1
C

Preference share is Non-Cumulative

and Non-Participating
CASES 2
A

Preference share is Cumulative and
Non-Participating
CASES 3

S
Preference share is Cumulative and
Participating
CASES 4

E
Preference share is Cumulative and
Participating up to 16 %
CASES 5
Preference share is Cumulative,

S Non-Participating w/ liquidation
value of 106 Per Share
CASE ONE:
CASE TWO:
CASE THREE:
CASE FOUR:
CASE FIVE: