Schroeder Company had 200,000 shares of common stock outstanding with a $2 par value and retained...

 

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Schroeder Company had 200,000 shares of common stock outstanding with a $2 par value and retained earnings of $90,000. In 2010, earnings per share were $0.50. In 2011, the company split the stock 2 for 1. Which of the following would result from the stock split? 1. Retained earnings will decrease as a result of the stock split. 2. A total of 400,000 shares of common stock will be outstanding. 3. The par value would become $4 par. 4. Retained earnings will increase as a result of the stock split. 5. None of the above. Schroeder Company had 200,000 shares of common stock outstanding with a $2 par value and retained earnings of $90,000. In 2010, earnings per share were $0.50. In 2011, the company split the stock 2 for 1. Which of the following would result from the stock split? 1. Retained earnings will decrease as a result of the stock split. 2. A total of 400,000 shares of common stock will be outstanding. 3. The par value would become $4 par. 4. Retained earnings will increase as a result of the stock split. 5. None of the above.

Answer rating: 100% (QA)

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