Stark Industries currently trades for $50 per share and has 175M shares outstanding.It announces that it will execute a reverse-split on a 1-for-3 basis.How many shares will be outstanding after the split?

Question

Quizplus · Accepted Answer

The Split ratio is:
S = 11ea7fdb_fc56_70cb_a768_7be66ee9b043_TB2902_11 S = 11ea7fdb_fc56_70cc_a768_a160d1de2a70_TB2902_11 = 0.33
Shares outstanding after the split is:
Shares outstanding after the split = S × Shares outstanding before the split
Shares outstanding after the split = 0.3333 × 175M
Shares outstanding after the split = 58.333M

Stark Industries Currently Trades for $50 Per Share and Has