Respuesta :
Answer:
a. New share price is $24.00
b. New share price is $34.78
c. New share price is $26.94
d. New share price is $93.33
e. We have:
a. New shares outstanding are 758,333.33 shares
b. New shares outstanding are 523,250.00 shares
c. New shares outstanding are 675,675.00 shares
d. New shares outstanding are 195,000.00 shares
Explanation:
a. RC has a five-for-three stock split? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) New share price $
The new share price can be calculated as follows:
New share price = Current share price / (5/ 3) = $40 / 1.66666666666667 = $24.00
b. RC has a 15 percent stock dividend? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) New share price $
The new share price can be calculated as follows:
Stock dividend percentage = 15%, or 0.15
New share price = Current share price / (1 + Stock dividend percentage) = $40 / (1 + 0.15) = $40 / 1.15 = $34.7826086956522
Rounding to 2 decimal places, we have:
New share price = $34.78
c. RC has a 48.5 percent stock dividend? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)New share price $
The new share price can be calculated as follows:
Stock dividend percentage = 48.5%, or 0.485
New share price = Current share price / (1 + Stock dividend percentage) = $40 / (1 + 0.485) = $40 / 1.485 = $26.9360269360269
Rounding to 2 decimal places, we have:
New share price = $26.94
d. RC has a three-for-seven reverse stock split? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)New share price $
The new share price can be calculated as follows:
New share price = Current share price / (3 / 7) = $40 / 0.428571428571429 = 93.3333333333332
Rounding to 2 decimal places, we have:
New share price = $93.33
e. Determine the new number of shares outstanding in parts (a) through (d). (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)a. New shares outstanding b. New shares outstanding c. New shares outstanding d. New shares outstanding
For part a
New number of shares outstanding = Current number of shares * (5 / 3) = 455,000 * 1.66666666666667 = 758,333.333333335
Rounding to 2 decimal places, we have:
New number of shares outstanding = 758,333.33 shares
For part b
Number of stock share issued = Current shares outstanding * Stock dividend percentage = 455,000 * 15% = 68,250
New number of shares outstanding = Current number of shares + Number of stock share issued = 455,000 + 68,250 = 523,250.00 shares
For part c
Number of stock share issued = Current shares outstanding * Stock dividend percentage = 455,000 * 48.5% = 220,675
New number of shares outstanding = Current number of shares + Number of stock share issued = 455,000 + 220,675 = 675,675.00 shares
For part d
New number of shares outstanding = Current number of shares * (3 / 7) = 455,000 * 0.428571428571429 = 195,000 shares
The Roll Corporation(RC) will calculate the share price determinations are as follows:
a. 5-for-three stock split:
Total number of shares = 758,333 (455,000 x 5/3)
New Share Price = $24 ($40 x 3/5)
b. 15% stock dividend:
Total number of shares = 523,250 (455,000 x 1.15)
New Share Price = $34.78 (455,000 x $40)/523,250
c. 48.5% stock dividend:
Total number of shares = 675,675 (455,000 x 1.485)
New Share Price = $26.94 (455,000 x $40)/675,675
d. Three-for-Seven Reverse Stock Split:
Total number of shares = 195,000 (455,000 x 3/7)
New Share Price = $93.33 (455,000 x $40)/195,000
e. The new number of shares outstanding are:
a. 758,333 shares
b. 523,250 shares
c. 675,675 shares
d. 195,000 shares
Data and Calculations:
Current outstanding stock = 455,000 shares
Selling price per share = $40
Market value of outstanding stock = $18,200,000 (455,000 x $40)
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