The common stock of Wilt, Inc. is selling for $65 a share. The book value per share is $36.50. Currently, the firm has a total market value of $100,750. How many shares of stock will be outstanding if the firm does a 3-for-2 stock split?

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Quizplus · Accepted Answer

First, find the current number of shares outstanding by dividing the total market value by the price per share: $100,750 / $65 = 1,550 shares. After a 3-for-2 stock split, for every 2 shares owned, a shareholder will now own 3 shares. Therefore, the number of shares after the split is (3/2) * 1,550 = 2,325 shares.

The Common Stock of Wilt, Inc