Xian Inc.has 7,000,000 shares outstanding.If the company declares a 3 for 2 reverse stock split, determine the number of shares outstanding afterwards.

Question

Quizplus · Accepted Answer

In a 3 for 2 reverse stock split, for every 3 shares an investor holds, they are combined into 2 shares. Therefore, to find the new number of shares outstanding, you divide the original number of shares by 3 and then multiply by 2: (7,000,000 / 3) * 2 = 4,666,666.67. However, since the number of shares must be a whole number, and the provided options do not match this calculation, it appears there has been a misunderstanding in the question's premise, likely intending to describe a forward stock split rather than a reverse one. If it were a 3 for 2 stock split (forward), the calculation would be (7,000,000 / 2) * 3 = 10,500,000, which is not among the provided options. Given the options and the context, it seems there's been a mistake in interpreting the question or the answer choices provided.

Xian IncHas 7,000,000 Shares Outstanding