Reference no: EM132674268

Kinmi Financial Corporation is the parent company of Kinmi Bank. The company's stock split was announced in the following wire:

• LOS ANGELES Jan. 20 BUSINESS WIRE-Kinmi Financial Corporation (Nasdaq), announced that the Board of Directors has approved a two-for-one stock split, to be effected in the form of a 100 percent common stock dividend.
• Kinmi Financial Corporation stockholders of record at the close of business on January 31 will receive one additional share of common stock for every share of common stock then held.
• Distribution of additional shares issued as a result of the split is expected to occur on or about February 15.

At the time of the stock split, 37.5 million shares of common stock, $0.001 par per share, were outstanding.

Required:

Problem 1. Prepare the journal entry, if any, that Kinmi recorded at the time of the stock split.

Problem 2. If Kinmi's stock price had been $49 at the time of the split, what would be its approximate value after the split (other things equal)?