Follow Up Question Pilsen Company issues 12% bonds with a face value of $10,000 and 600 shares of $10 par common stock in a combined sale, receiving total proceeds of $23,000 on December 31. Required: Record the transaction for each independent assumption shown: 2.The common stock has a current market value of $24.50 per share; the bonds are selling at 98. Can you please explain the calculation and the concept for 'premium on common stock'? 23,000 * 14,700 ($24.5 * 600 shares) / $24,500 (what is this, how do you get this?) - $6,000 Thanks

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Stockholder's Equity

The stockholders’ equity (often referred to as the book value of the company) is the number of assets available to the stockholder after its entire liabilities is paid off. The stockholders’ equity is also sometimes referred to as owner's equity. The stockholders’ equity or book value generally includes common stock, treasury stock retained earnings. It is an indicator of a company's financial strength and is an important item on the company's balance sheet.