Essentials of Corporate Finance (Mcgraw-hill/Irwin Series in Finance, Insurance, and Real Estate)
Essentials of Corporate Finance (Mcgraw-hill/Irwin Series in Finance, Insurance, and Real Estate)
9th Edition
ISBN: 9781259277214
Author: Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Bradford D Jordan Professor
Publisher: McGraw-Hill Education
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Chapter 14, Problem 5QP

a)

Summary Introduction

To determine: The number of shares outstanding and new par value of the shares when the company declares a 2-1 stock split.

Introduction:

The par value of the common stock gets affected in the equity account. Stock split reduces the stock price as the number of shares outstanding increases.

b)

Summary Introduction

To determine: The number of shares outstanding and new par value of the shares when the company declares a 1-4 reverse stock split.

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