A stock split and/or a stock dividend will result in an:
A) increase in the number of shares outstanding.
B) increase in the market value of the firm.
C) increase in the total assets of the firm.
D) increase in both the number of shares outstanding and the total assets of the firm.

Question

Quizplus · Accepted Answer

A stock split and/or a stock dividend will result in an increase in the number of shares outstanding. A stock split involves the division of existing shares into multiple shares, thereby increasing the total number of shares outstanding. Similarly, a stock dividend involves the issuance of additional shares as a dividend, which also increases the number of shares outstanding. However, neither a stock split nor a stock dividend will affect the market value or total assets of the firm.

A Stock Split And/or a Stock Dividend Will Result in An