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?

Solutions

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.

Do give Thumbs up if you find this helpful.

jeff jeffy answered 3 weeks ago

Next > < Previous

Related Solutions

6/ A. You own a portfolio that has 4,100 shares of stock A, which is priced...

6/ A. You own a portfolio that has 4,100 shares of stock A, which is priced at 14.8 dollars per share and has an expected return of 4.97 percent, and 2,100 shares of stock B, which is priced at 24.9 dollars per share and has an expected return of 11.35 percent. The risk-free return is 3.14 percent and inflation is expected to be 2.41 percent. What is the expected real return for your portfolio? Answer as a rate in decimal...

A company has 9 million shares of common stock outstanding, 340,000 shares of 6 percent preferred...

A company has 9 million shares of common stock outstanding, 340,000 shares of 6 percent preferred stock outstanding, and 180,000 7.8 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $38 per share and has a beta of 1.50, the preferred stock currently sells for $88 per share, and the bonds have 20 years to maturity and sell for 119 percent of par. The market risk premium is 7.8 percent, T-bills are yielding 3 percent,...

You own 1,500 shares of stock in a company that is 25% debt financed. The stock...

You own 1,500 shares of stock in a company that is 25% debt financed. The stock price is $50 per share. You want to use homemade leverage to unlever your shares to replicate an all-equity capital structure. What amount will you borrow or lend? Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit any commas and the $ sign in your response. For example, an answer of $1,000.50 should be entered as 1000.50.

2. Employee Stock Ownership Plans (ESOPs): MULTIPLE CHOICE a. will not dilute the proportional ownership of...

2. Employee Stock Ownership Plans (ESOPs): MULTIPLE CHOICE a. will not dilute the proportional ownership of existing shareholders. b. may be created for a temporary purpose. c. do not produce any tax advantages for plan participants. d. may borrow funds from a bank. 3. The following relate to Data Original in 2008. What is the ending inventory? Purchases $540,000 Beginning Inventory 80,000 Customer Returns 10,000 Sales 800,000 Cost of Goods Sold 490,000 Multiple Choice a. $120,000 b. $140,000 c. $210,000...

Parvin Corporation issues 40,000 shares of its own $10 par common stock for all the outstanding...

Parvin Corporation issues 40,000 shares of its own $10 par common stock for all the outstanding stock of Sacks Corporation in merger consummated on October 1, 2012 (Sacks Corporation dissolved). On this date, Parvin Corporation paid $10,000 for direct cost, and $3,000 for indirect cost of business combination as well as $5,000 for cost of printing and issuing new shares. Summary balance sheet data for the two companies at October 1, 2012, just before combination, are as follow: Parvin ...

You own a portfolio that is 30 percent invested in Stock X, 25 percent in Stock...

You own a portfolio that is 30 percent invested in Stock X, 25 percent in Stock Y, and 45 percent in Stock Z. The expected returns on these three stocks are 9 percent, 18 percent, and 14 percent, respectively. What is the expected return on the portfolio? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Assume the company has a stock option pool representing 15% of the total number of shares....

Assume the company has a stock option pool representing 15% of the total number of shares. The options vest in 5 years. How many shares of the company should the VC ask for today to avoid dilution of her ownership?

On December 31, 2020, Jackson Company had 100,000 shares of common stock outstanding and 40,000 shares...

On December 31, 2020, Jackson Company had 100,000 shares of common stock outstanding and 40,000 shares of 6%, $50 par, cumulative preferred stock outstanding. On February 28, 2021, Jackson purchased 34,000 shares of common stock on the open market as treasury stock for $45 per share. Jackson sold 7,000 treasury shares on September 30, 2021, for $47 per share. Net income for 2021 was $190,905. Also outstanding during the year were fully vested incentive stock options giving key executives the...

You own a stock portfolio invested 32 percent in Stock Q, 22 percent in Stock R,...

You own a stock portfolio invested 32 percent in Stock Q, 22 percent in Stock R, 19 percent in Stock S, and 27 percent in Stock T. The betas for these four stocks are 0.97, 0.61, 1.22, and 1.29, respectively. What is the portfolio beta? Enter the answer with 4 decimals (e.g. 1.1234)

You own a stock portfolio invested 20 percent in Stock Q, 20 percent in Stock R,...

You own a stock portfolio invested 20 percent in Stock Q, 20 percent in Stock R, 10 percent in Stock S, and 50 percent in Stock T. The betas for these four stocks are 1.12, 0.69, 1.16, and 1.69, respectively. What is the portfolio beta?

Subjects