If the Board of Directors Approves a Two for One

question 127

Multiple Choice

If the board of directors approves a two for one stock split, an investor who owns 200 shares before the split owns ____________ shares after the split.

• A)75
• B)200
• C)225
• D)400
• E)450

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Definitions:

Single-Step Income Statement

An income statement format that calculates net income using a single subtraction of total expenses from total revenue.

Fiscal Year

A fiscal year is a one-year period that companies and governments use for financial reporting and budgeting, which does not necessarily coincide with the calendar year.

Ledger Adjustments

Entries made in the general ledger to correct errors, update account balances, or reallocate funds across accounts.

Multiple-Step Income Statement

An income statement format that separates operating activities from non-operating activities, distinguishing between sales and expenses directly related to the business's primary operations and other sources or uses of income.