ACME Inc.has decided on a 4-for-1 stock split.If the firm currently has 400,000 shares outstanding,how many shares will be outstanding after the stock split?

Question

Quizplus · Accepted Answer

A 4-for-1 stock split means that for every one share owned, the shareholder will receive four new shares. Therefore, if there were 400,000 shares outstanding before the split, there will be 1,600,000 shares outstanding after the split (400,000 x 4 = 1,600,000).

ACME IncHas Decided on a 4-For-1 Stock Split