Before a three-for-one stock split,the shares outstanding were 5,000 shares at $12 par.After the split,what was the par and number of shares?

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Quizplus · Accepted Answer

In a three-for-one stock split, each original share is split into three shares, thus tripling the number of shares. The total par value remains the same, but it is divided among the increased number of shares. Therefore, if there were originally 5,000 shares at $12 par, after the split, there would be 15,000 shares (5,000 * 3). The par value per share would decrease to $4 ($12 original par / 3) to maintain the overall par value.

Before a Three-For-One Stock Split,the Shares Outstanding Were 5,000 Shares