On January 1,2015,WVC Split Its Common Shares 4 for 1

question 148

Multiple Choice

On January 1,2015,WVC split its common shares 4 for 1 when the market value was $80 per share.Prior to the split,WVC had 50,000 common shares issued and outstanding (average issue price $12 per share) .After the split,the average issue price of the shares was reduced:

• A) By $3 per share.
• B) To $3 per share.
• C) To $4 per share.
• D) To $2.40 per share.
• E) No change in the par value.

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Definitions:

Rate of Return

The accrual or depletion in value of an investment across a chosen period, quantified as a percentage of the investment’s initial expense.

Constant Dividend

A policy in which a firm aims to pay out a fixed dividend amount to shareholders regularly.

Constant Dividend

A Constant Dividend refers to a fixed amount of money paid out to shareholders of a corporation's profits on a regular basis.

Market Rate

The prevailing interest rate or price available in the marketplace for goods, services, or securities.