Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Stock Split and Reverse Split
This is whereas a block of shares is broken down into smaller units or shares hence the number of ordinary shares rises and their respective par value reduce at the stock split factor. Stock split is meant to make the shares of a company more affordable through low income investors and increase their liquidity in the market.
Illustration
ABC Company has 1000 ordinary shares of Sh.20 par value and a split of 1:4 that is one stock is split into 4. The par value is divided via 4.
1000 stocks x 4 = 4000 shares
par value = 40/5
= Sh.5
Ordinary share capital = 4000 x 5 = Shs.20,000
A reverse split is the opposite of stock split and involves consolidation of shares into bigger units thereby increasing the par value of the shares. It is meant to attract high income clientele shareholders. As like incase of 20,000 shares @ Shs.20 par, they can be consolidated into 10,000 shares of Shs.40 par. That is (20,000 x ½) = 10,000 and Sh.20 = x 2 = 40/=
Timing of Investment a Stock Exchange The ideal way of creation profits on the stock exchange is to buy on the bottom of the market or lowest M.P.S and sell at the top of the
Shareholders and Management There is near separation of ownership and management of the firm. Landlord employs professionals as managers who such have technical skills. Manage
Stock Exchange Market The Idea and improvement of a Stock Exchange Stock exchange also identified as stock markets are special "market places" whereas already held bond
Incentive Problem and Consumption of Perquisites Incentive Problem Managers may have fixed salary and they may have no incentive to work hard and maximize shareholders weal
Benefits of Payback Period 1. use simply and understand and it has created it popular among in ascertaining the viability of venture executives, mainly traditional financial m
How is finance related to the disciplines of accounting and economics? Financial management is necessarily a combination of economics and accounting. First, financial managers
what makes a preference shares a hybrid?
Profitability Ratio These ratios signify the performance of the firm in relation to its capability to derive returns or profit from investment or from sale of goods that is pr
Mr. and Mrs. smith are considering the purchase of a house. They can afford to make a mortgage payment of $750 per month. If the current mortgage interest rate is 9% with monthly
Similarities between Preference Share Capital and Debt Similarities between Preference Share Capital and Debt are as follows: a) Both have fixed returns. b) Both do not
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd