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Stock Splits and Shareholder's equity

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6. For a company, what is the impact (net change) on Total Shareholders' Equity when a company announces a 2 for 1 stock split on 200,000 shares that have a $2 par value?

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Impact of stock splits on shareholder's equity

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When 2 for 1 split takes place, the total number of shares increases from 200,000 shares to 400,000 shares. However, the par value of the shares is decreased ...

Solution provided by:
Sheetal Jain, PGDM
Education
  • BComm, University of Delhi
  • Post Graduate Diploma in Management (Equivalent to MBA), All India Management Association
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