Philip's Garage has 25,000 shares of stock outstanding with a market price of $47 per share. The balance sheet shows $211,500 in the common stock account and $211,400 in the retained earnings
Account. The ﬁrm just announced a 5-for-3 stock split. How many shares of stock will be
Outstanding after the split?

Question

Quizplus · Accepted Answer

After the 5-for-3 stock split, each existing share will become 5/3 shares.

So, the total number of shares outstanding after the split will be:

25,000 x 5/3 = 41,667 shares.

Therefore, the correct answer is (E) 41,667 shares.

Philip's Garage Has 25,000 Shares of Stock Outstanding with a Market