Monarch Financial Holdings, Inc. executed a 6-for-5 traditional split on October 5. Before the split there were approximately 4,800,000 shares outstanding, each at a share price of $18.00.
a. Use the method outlined in Examples 2 and 3 on pages 46 and 47 to determine the post-split share price and number of shares outstanding.
b. Compare the results from part a. with that obtained by using Jon's method. Jon's method says that 6-for-5 is the same as 1.2-for-1.