23. The Peanut Shack has 6,000 shares of stock outstanding with a par value of $

Question

23. The Peanut Shack has 6,000 shares of stock outstanding with a par value of $1 per share. The current market value of the firm is $145,600. The company just announced a 3-for-2 stock split. What will the market price per share be after the split? 24. East Coast Marina has 220,000 shares of stock outstanding. The current market value of the firm is $18.92 million. The company has retained earnings of $3.8 million, paid in surplus of $6.7 million, and a common stock account value of $220,000. The company is planning a 3-for-2 stock split. What will the market price per share be after the split?

Explanation / Answer

Market price per share = (145600/6000) x 2/3 = $16.17

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