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Question
Use the following information to answer the following question(s).Your firm is planning a 2 for 1 stock split. The market price for the stock has been $84. The table below presents the equity portion of your firm's balance sheet before the split.
| Common stock | |
| Par value | |
| (1 million shares | |
| outstanding; $4 par value) | $4,000,000 |
| Paid-in capital | 16,000,000 |
| Retained earnings | 30,000,000 |
| Total equity | $50,000,000 |
After the stock split, the number of shares outstanding, their par value and the total common stock account will stand at:
A) 2,000,000; $4.00; $8,000,000.
B) 500,000; $8.00; $4,000,000.
C) 2,000,000; $2.00; $4,000,000.
D) 500,000; $2.00, $2,000,000.
Answer
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