Hopeful Ltd. had issued​ 500,000 shares at a nominal value of 25p each when it commenced business. After two years of profitable trading it issued a further​ 250,000 shares at a market price of 75p per share. Which of the following would be reported as equity in the statement of financial position after the second share​ issue?     A. Share capital £​187,500, share premium £​125,000   B. Share capital £​125,000, share premium £​187,500   C. Share capital £​312,500   D. Share capital £​125,000, share premium £​125,000

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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.