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Use the following info for Questions 3 and 4. On August 30th, 2020 Tesla Inc. declared a 5-for-1 stock split. Due to the split, the
Use the following info for Questions 3 and 4. On August 30th, 2020 Tesla Inc. declared a 5-for-1 stock split. Due to the split, the market price per share went from about $1,500 per share down to about $350 per share. From accounting standpoint, there was no need to do adjustment to Common Stock or Paid in Capital. Thus, Total Equity after the split stayed the same Reason for split Tesla stated that it executed this 5-for-1 stock split because it wanted to make its shares more available to employees and investors. Tesla offers stock options for employees throughout the entire organization, and for employees who are on the lower levels of the pay scale, it can only mean a few stocks when it trades at $1,400+ per share. If the company can't issue fractional shares, it makes for big rounding differences and a lower price per share will fix that. The split led to decrease in Tosla share price to $350 making the stock affordable for more people Suppose that your dearest grandma knowing your passion for technology bought you one Tesla share as a Christmas present in 2019. So, as of December 25, 2019 you became a proud Tesla investor 3. (0,5 point) On August 30", 2020, you received a message from Teslo, notifying you that you just become an owner of Tesla shares a. 1 b. 2 C5 d50 4. (0.5 point) After the stock split you became an owner of a ownership stake diluted as a result of the stock split?) a bigger b. smaller . much smaller d. Same part of the Tesla company. (Put it differently, was your
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