When a Corporation Completes a 3-For-1 Stock Split

question 207

Multiple Choice

When a corporation completes a 3-for-1 stock split,

• A) the ownership interest of current stockholders is decreased
• B) the market price per share of the stock is decreased
• C) the par value per share is decreased
• D) the market price per share of the stock and the par value per share are decreased

---

Definitions:

Direct Materials Quantity Variance

The difference between the actual quantity of materials used in production and the standard quantity expected, multiplied by the standard cost per unit.

Direct Labor Time Variance

The difference between the actual time taken to complete a task and the standard time expected, multiplied by the labor rate.

Factory Overhead Volume Variance

The difference between the budgeted and actual volume of production, affecting the allocation of fixed manufacturing overhead costs to products.

Direct Materials Price Variance

A measure used in cost accounting that calculates the difference between the actual cost of direct materials and the standard cost expected to be incurred.