Question

In: Finance

You own 40,000 shares of stock of a company, representing 6 percent ownership. The company plans...

You own 40,000 shares of stock of a company, representing 6 percent ownership. The company plans a 3-for-2 stock split. After the split, How many shares would you own? What percentage of the company would you own?

Expert Solution

3 for 2 stock split means that every shareholder who has earlier 2 share will now have 3 share.

Percentage of the company

Since before split you have 6 percent ownership and 40,000 shares it means total no. of shares in company before split would be:

So it means the percentage would be same even after stock split

I hope this clear your doubt.

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jeff jeffy answered 5 months ago

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