Question
In: Finance
Mill Creek Corporation (MCC) currently has 430,000 shares of stock outstanding that sell for $50 per...
|
Mill Creek Corporation (MCC) currently has 430,000 shares of stock outstanding that sell for $50 per share. Assuming no market imperfections or tax effects exist, what will the share price be after: |
| a. |
MCC has a 4-for-3 stock split? |
| New share price | $ per share |
| b. |
MCC has a 10 percent stock dividend? (Round your answer to 2 decimal places. (e.g., 32.16)) |
| New share price | $ per share |
| c. |
MCC has a 43.5 percent stock dividend? (Round your answer to 2 decimal places. (e.g., 32.16)) |
| New share price | $ per share |
| d. |
MCC has a 3-for-7 reverse stock split? |
| New share price | $ per share |
|
Determine the new number of shares outstanding in parts (a) through (d). (Round your answers to the nearest whole number. (e.g., 32)) |
| a. New shares outstanding | |
| b. New shares outstanding | |
| c. New shares outstanding | |
| d. New shares outstanding | |
Solutions
Expert Solution
| a | New share price | $ 37.50 | =50*3/4 |
| b | New share price | $ 45.45 | =50/(1+10%) |
| c | New share price | $ 34.84 | =50/(1+43.5%) |
| d | New share price | $ 116.67 | =50*7/3 |
| a | New shares outstanding | 573,333 | =430000*4/3 |
| b | New shares outstanding | 473,000 | =430000*(1+10%) |
| c | New shares outstanding | 617,050 | =430000*(1+43.5%) |
| d | New shares outstanding | 184,286 | =430000*3/7 |
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