Effect of Stock Split Copper Grill Restaurant Corporation wh

Effect of Stock Split Copper Grill Restaurant Corporation wholesales ovens and ranges to restaurants throughout the Southwest. Copper Grill Restaurant Corporation, which had 48,000 shares of common stock outstanding, declared a 4-for-1 stock split. a. What will be the number of shares outstanding after the split? shares b. If the common stock had a market price of $192 per share before the stock split, what would be an approximate market price per share after the split? per share

Solution

Question 1.

The no.of.shares outstanding after the stock split will be

Calculation of shares after split = 48000*(4/1)=192000 shares

Question 2.

Market price after the stock split

= (current market price * shares outstanding)/ No.of shares after the stock split

=(192*48000)/192000

= 48 per share.