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Stock split Firm Growth Industries current stockholders equity account is as follows: Preferred stock Common stock (200,000

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Answer #1

Given,

Number of common shares outstanding: 200,000

Par value per share: $4

  1. On a 2-for-1 stock split, 2 shares are allotted in place of the existing one share. Hence number of shares will increase to 200,000*2 =400,000.

Par value per share will decrease to $4/2 = $2.

  1. On a 1-for 1.5 reverse split, 1.5 existing shares will be converted into one share. Number of shares will reduce to 200,000/1.5 = 133,333

Par value of share will increase to $4*1.5 = $6

  1. On a 3-for-1 stock split, 3 shares are allotted in place of the existing one share. Hence number of shares will increase to 200,000*3 =600,000.

Par value per share will decrease to $4/3 = $1.33

  1. On a 6-for-1 stock split, 6 shares are allotted in place of the existing one share. Hence number of shares will increase to 200,000*6 =1,200,000.

Par value per share will decrease to $4/6 = $0.67

  1. On a 1-for 4 reverse split, 4 existing shares will be consolidated into 1 share. Hence the number of shares will reduce to 200,000/4 = 50,000

Par value of share will increase to $4*4 = $16

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