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CORPORATE ACTIONS

Total questions: 15

Worksheet time: 45mins

Name
Class
Date
1.

What is the record date for dividends?

a)

Determining the payment and ownership of stock

b)

When all details need to be provided to the share registry

c)

The actual payment date

d)

The account reconciliation date

2.

Which statement is correct for a Share split?

a)

A share split is the multiplication of shares into a larger number of shares each with a correspondingly larger market value.

b)

A share split is the subdivision of shares into a larger number of shares each with a correspondingly lower market value.

c)

A share split is the multiplication of shares into a larger number of shares each with a correspondingly lower market value.

d)

A share split is the subdivision of shares into a smaller number of shares with a marginably higher value

3.

Which description below is correct?

a)

A corporate action is an event initiated by a government that brings or could bring an actual change to the company structure— impacting share holders

b)

A corporate action is an event initiated by a company or corporation that brings or could bring an actual change to the securities—equity or debt—issued by the company.

c)

A corporate action is an event initiated by shareholders that brings or could bring an actual change to management of a company

d)

A corporate action is an event initiated by a company or corporation that needs to be agreed upon by the respective government

4.

The decrease of shareholder ownership through the issuance of additional shares is called:

a)

Dilution

b)

Liquidity

c)

Capitalization

d)

Really bad luck

5.

What is a take over?

a)

When a company makes a bid for another companies shares

b)

When someone buys another persons holdings

c)

A term used when there is a change of management

d)

When a company sells all its assets

6.

which of the following shares issued to existing shareholders when company wishes to raise further capital ?

a)

sweat equity

b)

right issue

c)

bonus shares

d)

none of the above

7.

If a company issues a 5 : 6 stock, an investor will have more shares after the split is executed and the price per share will be higher than the pre-split price.

a)

True

b)

False

8.

After a company issued a 4 : 3 stock split, the new share price was $56.25. What was the pre-split price of the stock?

a)

56.25

b)

93.75

c)

65.52

d)

100.00

9.

Yesterday, Tenser Inc. executed a 3-for-1 split. Jamie was holding 600 shares of the stock before the split and each was worth $34.11. How many shares did she hold after the split? What was the post-split price per share?

a)

200, 11.37

b)

1800, 102.33

c)

200, 102.33

d)

1800, 11.37

10.

Qual Comm, Inc. instituted a 4-for-1 split in November. After the split, Elena owned 12,800 shares. How many shares had she owned before the split?

a)

3200

b)

320

c)

38400

d)

8400

11.

In October, Johnson Controls, Inc instituted a 3-for-1 split. After the split, the price of one share was $39.24. What was the pre-split price per share?

a)

117.42

b)

13.08

c)

116.24

d)

15.02

12.

Steve owned 942 shares of Graham Corporation. On January 3, a 5-for-4 split was announced. The stock was selling at $56 per share before the split. After the split, Steve received a check in the mail for a fractional part of a share. How much was the check?

a)

44.80

b)

11.20

c)

22.40

d)

89.60

13.

Jillian owns 60% of the stock in a private catering corporation. There are 1,200 shares in the entire corporation. How many shares would she have to sell in order to only own 51% of the shares?

a)

108

b)

122

c)

120

d)

720

14.

In a reverse stock split, the investor receives fewer shares and the price of one share increases.

a)

True

b)

False

15.

Suppose that before a stock split, a share was selling for $1.75. After the stock split, the price was $5.25 per share. What was the stock-split ratio?

a)

1 : 3

b)

3 : 1

c)

1 : 2

d)

3 : 2