Question

The market value of Dylan Corporation’s common stock had become excessively high. The stock was currently selling for $240 per share. To reduce the market price of the common stock, Dylan declared a 3-for-1 stock split for the 200,000 outstanding shares of its $10 par common stock.

Required
a. How will Dylan Corporation’s books be affected by the stock split?
b. Determine the number of common shares outstanding and the par value after the split.
c. Explain how the market value of the stock will be affected by the stock split.



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  • CreatedOctober 12, 2013
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