A company has 400,000 outstanding shares of $3 par value common stock. A 1:2 stock split is declared. After the split, the company will have
A) 800,000 shares of $6 par value stock.
B) 200,000 shares of $6 par value stock.
C) 200,000 shares of $3 par value stock.
D) 800,000 shares of $3 par value stock.
E) answer cannot be determined without knowing the market value of the stock after the split.
Correct Answer:
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