Hexagon declares a four-for-one stock split. How many shares are outstanding now
ID: 2745393 • Letter: H
Question
Hexagon declares a four-for-one stock split. How many shares are outstanding now? (Do not round intermediate calculations.)
Hexagon declares a four-for-one stock split. What is the new par value per share? (Do not round intermediate calculations and round your final answer to 3 decimal places. (e.g., 32.16))
Hexagon declares a one-for-five reverse stock split. How many shares are outstanding now? (Do not round intermediate calculations.)
Hexagon declares a one-for-five reverse stock split. What is the new par value per share? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
The owners’ equity accounts for Hexagon International are shown here:
Explanation / Answer
Outstanding shares = $40,000 / $0.50 = 80,000
a1. In 4-for-1 stock split, the total outstanding number of shares = 80,000*4 = 320,000
a2. Par value of the stock = $0.50 / 4 = $0.125 per share
b1. In 1-for 5 reverse stock split, the total outstanding number of shares = 80,000 / 5 = 16,000
b2. Par value of the stock = $0.50 x 5 = $2.5