Statement 1: A split up increases the number of shares held and decreasesthe cost per share. Statement 2: A stock dividend is recorded as a creditto dividend income.Only statement 1 is trueOnly statement 2 is trueBoth statements are trueBoth statements are false

In this question, there are two statements We have to decide which statements are correct or which…

Answered: atement 1:A spiit up increases the he…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Similar questions

Which of the following results in increasing basic earnings per share? Select one: a. Paying more than carrying value to retire outstanding bonds. b. Issuing cumulative preferred stock. c. Repurchase of common shares. d. Issuing a 2:1 stock split. e. All of these increase basic earnings per share.
"The dividend discount model is used to find the price of a stock based on the expected dividends received by the shareholder and the discount rate. Therefore, all else constant, the price of a share of stock will increase if the discount rate decreases." A) True B) False
Treasury stock is generally accounted for by the * cost method. O market value method. O par value method. O stated value method.
According to the basic Dividend Discount model, the value an investor should assign to a share of stock is dependent on the length of time he or she plans to hold the stock. Is the above statement True or False? Please Explain.
Par value of a stock refers to the ________.
A stock's internal rate of return (IRR) is the discount rate that cause the present value of future dividends and the price at which a stock is expected to be sold to equal the current price of the stock. O True O False C
Apart from using PE ratio, what is another way of valuing the stock price? if we have the EPS, Share Price, Dividend Per Share, ROE and the discount rate (R). And what are the assumptions and the limitations of this model? Is it the PEG ratio or not??
Earnings per share is a profitability ratio measuring how much a furm earns per share of common stock outstanding. True False
The cost of preferred stock: a. is equal to the dividend yield b. is independent of the stock's price c. is equal to the YTM d. depends on dividend's growth rate
hh.3
The duration of a preferred stock is its maturity. OA. Greater than or less than, depending on its YTM OB. Less than OC. Greater than O D. Equal to
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atement 1:A spiit up increases the he cost per share. Statement 2: A stock