A stock split is the issuance of additional shares to existing shareholders without affecting the shareholding of each shareholder. When a company decides to 2-1 stock split it means that the shareholder having one share will now have 2 shares. This also means that if a company has 10 million shares outstanding and decides to split the stock in two for one, it will have now 20 million shares in outstanding but this will not affect the overall percentage of holding for any shareholder.
Since the number of shares is increased as a result of stock split the price is also reduced for each share but not necessarily the exact half of the existing share price. This also leads to increased demand for the stocks of that company as the investors think that the shares are now more affordable to purchase.
Gamma Medical’s stock trades at $90 a share. The company
The balance sheet of Consolidated Paper, Inc., included the following
Listed below are the transactions that affected the shareholders’ equity of Branch
Hoosier Corporation declared a 2-for-1 stock split to
Indicate by letter whether each of the transactions listed below increases (
Alcoa is the world’s leading producer of primary aluminum, fabricated aluminum
Newton Inc. uses a calendar year for financial reporting. The
Refer to the situation described in BE 18–13, but
Hatch Company has two classes of capital stock outstanding: 8%,
What is a reverse stock split? What would be the effect
