ABC Corporation offered a four-for-one stock split.The number of outstanding shares before the split was 15,000 and the par value was $20 per share.After the split,what was the par value and number of shares?

Question

Quizplus · Accepted Answer

After a four-for-one stock split, the number of outstanding shares would increase by four times, so the new number of outstanding shares would be 60,000 (15,000 x 4). The par value, however, would decrease by four times, so the new par value would be $5 per share ($20 / 4). Therefore, option C is the correct choice.

ABC Corporation Offered a Four-For-One Stock Split