A corporation has 50,000 shares of $100 par value stock outstanding that has a current market value of $180. If the corporation issues a 4-for-1 stock split, the market value of thestock will fall to approximately:Oa. $36.Ob. $30.Oc. $50.Od. $45.

4-for-1 stock split means that every shareholder will have 4 shares for each share held before. The…

A corporation has 50,000 shares of $100 par value stock outstanding that has a current market value of $180. If the corporation isues a 4-for-1 stock split, the market value of the stock will fall to approximately: Oa. $36. Ob. $30. Oc. $50. Od. $45.

A corporation has 50,000 shares of $100 par value stock outstanding that has a current market value of $180. If the corporation isues a 4-for-1 stock split, the market value of the stock will fall to approximately: Oa. $36. Ob. $30. Oc. $50. Od. $45.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter14: Corporation Accounting

Section: Chapter Questions

Problem 12MC: A corporation issued 100 shares of $100 par value preferred stock for $150 per share. The resulting...

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Concept explainers

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.

Question

A corporation has 50,000 shares of $100 par value stock outstanding that has a current market value of $180. If the corporation issues a 4-for-1 stock split, the market value of the
stock will fall to approximately:
Oa. $36.
Ob. $30.
Oc. $50.
Od. $45.

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