This material may consist of step-by-step explanations on how to solve a problem or examples of proper writing, including the use of citations, references, bibliographies, and formatting. This material is made available for the sole purpose of studying and learning - misuse is strictly forbidden.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...