A subsidiary split its stock 2 for 1.Which of the following statements is false?
A)A stock split does not affect the amount of net assets of the subsidiary.
B)A stock split does not affect parent and noncontrolling interest ownership percentages.
C)A stock split does not affect consolidation procedures.
D)A 2 for 1 stock split decreases the number of shares outstanding.

Question

Quizplus · Accepted Answer

A 2 for 1 stock split actually increases the number of shares outstanding, but each share is worth half as much as before the split. Therefore, the total value of the outstanding shares remains the same.

A Subsidiary Split Its Stock 2 for 1