Mario's Has 18,000 Shares of Stock Outstanding with a Par

question 346

Multiple Choice

Mario's has 18,000 shares of stock outstanding with a par value of $1.00 per share and a market price of $33 a share. The balance sheet shows $18,000 in the common stock account, $285,000 in the paid in surplus account, and $162,000 in the retained earnings account. The firm just announced a 5-for-3 stock split. What will the paid in surplus account value be after the split?

• A) $255,000
• B) $285,000
• C) $303,500
• D) $295,800
• E) $315,000