e has 500,000 authorized shares of $2 par value common stock, with 110,000 shares issued and outstanding with a total current market value of $150,000. You are the owner of 12% of the stock. Which statement describes what happens when Sapphire executes a 3-for-1 forward stock split? You will own 36% of the company’s stock after the split. Your ownership is worth $450,000 after the split. You return your original shares to the company, and receive 39,600 new shares in exchange. You receive 39,600 additional shares of stoc
e has 500,000 authorized shares of $2 par value common stock, with 110,000 shares issued and outstanding with a total current market value of $150,000. You are the owner of 12% of the stock. Which statement describes what happens when Sapphire executes a 3-for-1 forward stock split? You will own 36% of the company’s stock after the split. Your ownership is worth $450,000 after the split. You return your original shares to the company, and receive 39,600 new shares in exchange. You receive 39,600 additional shares of stoc
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Sapphire has 500,000 authorized shares of $2 par value common stock, with 110,000 shares issued and outstanding with a total current market value of $150,000. You are the owner of 12% of the stock.
Which statement describes what happens when Sapphire executes a 3-for-1 forward stock split?
- You will own 36% of the company’s stock after the split.
- Your ownership is worth $450,000 after the split.
- You return your original shares to the company, and receive 39,600 new shares in exchange.
- You receive 39,600 additional shares of stock.
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