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Stock splits: for the company with the above information, show how the equity accounts will change if:

a. Quadrangle declares a four-for-one stock split. How many shares are outstanding now? What is the new par value per share?

# shares at $1 par = $30,000/$1 = 30,000
New # shares = 30,000(4/1) = 120,000

b. Quadrangle declares a one-for-five reverse stock split. How many shares are outstanding now? What is the new par value per share?

New # shares = 30,000(1/5) = 6,000
New Par per share = $1(5/1) = $5.00...

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