Robinson's Has 15,000 Shares Outstanding with a Par Value of £1.00

question 56

Multiple Choice

Robinson's has 15,000 shares outstanding with a par value of £1.00 per share and a market price of £36 a share.The statement of financial position shows £15,000 in the ordinary equity account,£315,000 in the additional paid in capital account,and £189,000 in the retained earnings account.The firm just announced a 3-for-2 stock split.What will the paid in surplus account value be after the split?

• A)£126,000
• B)£210,000
• C)£283,500
• D)£315,000
• E)£472,500

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Definitions:

Sub-prime Loans

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Mortgage Default Rate

The percentage of home mortgages on which the borrower is late by ninety days or more with the payments on the loan or it is in the foreclosure process. This rate is sometimes referred to as the serious delinquency rate.

Foreclosure Process

The legal procedure by which a lender attempts to recover the balance of a loan from a borrower who has defaulted on their mortgage payments by forcing the sale of the asset used as the collateral for the loan.

Monthly Payment

A fixed amount of money paid on a regular monthly basis for a wide range of financial obligations, including loans or rent.