Which of the following is true about stock splits and stock dividends? a. Only stock splits reduce the par value per share b. Both increase the total amount of stockholders’ equity c. Both reduce the...
Which of the following is true about stock splits and stock dividends?
a. Only stock splits reduce the par value per share
b. Both increase the total amount of stockholders’ equity
c. Both reduce the market price per share and par value per share
d. They have opposite effects on the market price per share
Homework Answers
Solution:
Only stock splits reduce the par value per share. This statement is true about stock splits and stock dividends.
Hence option "a" is correct.
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Which of the following is true about stock splits and stock dividends? a. Only stock splits reduce the par value per share b. Both increase the total amount of stockholders’ equity c. Both reduce the...
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EXERCISE 12.7 Cash Dividends, Stock Dividends, and Stock Splits HiTech Manufacturing Company has 1.000.000 shares of Si par value capital stock outstand: January 1. The following equity transactions occurred during the current year: Apr. 30 Distributed additional shares of capital stock in a 2-for-1 stock split. Market price arket price of stock was $35 per share. June 1 Declared a cash dividend of 50.60 per share. July Paid the 80.60 cash dividend to stockholders. Aug 1 Declared a 5 percent...
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28. On May 1, 2010, ROK Corporation had 400,000 shares of $30 par value common stock outstanding,...
28. On May 1, 2010, ROK Corporation had 400,000 shares of $30 par value common stock outstanding, with a market value of $90 per share. On May 2, 2010, ROK announced a 3-for-1 stock split. After the split, what was the par value of the stock? a. $10 b. $20 c. $30 d. $90 29. Which of the following statements is TRUE? a. Stock Splits decrease total stockholders' equity b. Cash Dividends decrease total Stockholders' Equity c. Stock Dividends decrease total Stockholders' Equity d. All of...
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If stock splits generally are used after a sharp price run-up to produce a large price reduction. Then which of the following statements about stock splits is correct? a. A company generally initiates a stock split to decrease the proportion of common stock contained in its capital structure. b. Stock splits have no effect on the per-share par value of the stock. c Stock splits should have no effect on a firm's market value. d All else equal, a stock...
Which of the following statements concerning preferred stocks is true? The par value of a stock...
Which of the following statements concerning preferred stocks is true? The par value of a stock is always the same as the initial selling price. Preferred stock dividends per share are normally increased as the earnings of the firm increase. Preferred stockholders have a prior claim on the income and assets of the firm as compared to the claims of lenders. Preferred dividends per share are usually not cut or suspended unless the firm is faced with serious financial problems.
Which of the following statements concerning preferred stocks is true? The par value of a stock...
Which of the following statements concerning preferred stocks is true? The par value of a stock is always the same as the initial selling price. Preferred stock dividends per share are normally increased as the earnings of the firm increase. Preferred stockholders have a prior claim on the income and assets of the firm as compared to the claims of lenders. Preferred dividends per share are usually not cut or suspended unless the firm is faced with serious financial problems.
Required information Problem 10-3A Indicate effect of stock dividends and stock splits (LO10-6) The following information applies to the questions displayed below.) Sammy's Sportshops has been very profitable in recent years and has seen its stock price steadily increase to over $100 per share. The CFO thinks the company should consider either a 100% stock dividend or a 2-for-1 stock split. Problem 10-3A Part 1 Required: 1. Complete the following table comparing the effects of a 100% stock dividend versus...
EXERCISE 12.7 Cash Dividends, Stock Dividends, and Stock Splits HiTech Manufacturing Company has 1.000.000 shares of Si par value capital stock outstand: January 1. The following equity transactions occurred during the current year: Apr. 30 Distributed additional shares of capital stock in a 2-for-1 stock split. Market price arket price of stock was $35 per share. June 1 Declared a cash dividend of 50.60 per share. July Paid the 80.60 cash dividend to stockholders. Aug 1 Declared a 5 percent...
Need answers
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