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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 |
Immediately after the stock split, the stock price will be approximately:
A) $42.
B) $84.
C) $2.00.
D) $8.00.
Answer
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