Which of the following statements is not true about a 2-for-1 stock split?
A)Total contributed capital increases.
B)Par value per share is reduced to half of what it was before the split.
C)A stockholder with ten shares before the split owns twenty shares after the split.
D)The market price probably will decrease.

Question

Quizplus · Accepted Answer

In a 2-for-1 stock split, the total contributed capital does not increase. The split simply doubles the number of shares outstanding while halving the par value per share, without changing the company's overall equity.

Which of the Following Statements Is Not True About a 2-For-1