Asked by Lydia Silva on Jun 03, 2024
Verified
A stock split increases total stockholders' equity.
Stock Split
A corporate action that increases the number of shares outstanding by issuing more shares to current shareholders, typically to make the stock more affordable.
Stockholders' Equity
The portion of the balance sheet that represents the owners' interest in the corporation, calculated as total assets minus total liabilities.
- Learn the procedures and effects of issuing stock dividends and stock splits on a company's financial position.
Verified Answer
EL
Emerald LafromboiseJun 07, 2024
Final Answer :
False
Explanation :
A stock split does not change the total stockholders' equity; it simply increases the number of shares outstanding while proportionally decreasing the price per share, leaving the overall market value unchanged.
Learning Objectives
- Learn the procedures and effects of issuing stock dividends and stock splits on a company's financial position.