Stocks and Shares
- A company issued 50000 shares of par value $ 100 each. If the total dividend declared by the company is $ 125000, out of which `50000 have been kept in reserve fund and the remaining is distributed as dividend, find out the rate of dividend paid by the company.
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Rate of dividend paid by the company = 
Net amount paid as dividend x 100% 
Total shares Correct Option: B
Here , Face value = $ 100
Total dividend declared = $ 125000
Amount kept in reserve fund = $ 50000
Net amount paid as dividend to the shareholders = $ (125000 - 50000) = $ 75000
Number of shares of par value $ 100 each = 50000
∴ Total par value of 50000 shares = Number of shares x Face value
Total par value of 50000 shares = $ (50000 × 100) = $ 5000000Rate of dividend paid by the company = Net amount paid as dividend x 100% Total shares Rate of dividend paid by the company = 75000 x 100 % = 3 % = 1 1 % . 5000000 2 2
- Find the income on 71/2% stock of $ 20000 purchased at $ 120.
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Required Income on $ 20000 = Income on $ 1 stock x Face value of the stock
Correct Option: C
Here , Face value of the stock = $ 20000
Income on $ 100 stock = $ 7 1 = $ 15 2 2 Income on $ 1 stock = $ 15 / 2 = $ 15 100 200
Required Income on $ 20000 = Income on $ 1 stock x Face value of the stockIncome on $ 20000 stock = $ 15 x 20000 = $ 1500 200
- The capital of a company is made up of 50000 preferred shares with dividend of 20% and 20000 common shares, the par value of each type of share being $ 10. The company had a total profit of $ 180000 out of which $ 30000 were kept in reserve fund and the remaining distributed to shareholders. Find out the dividend percent to the common shareholders.
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Hence, dividend percent paid on a common share
= dividend paid on a common share x 100% 
Face value of one share
Correct Option: C
Given :- Face value of each share = $ 10
Number of preferred shares = 50000
Total number of preferred shares = Number of preferred shares x Face value of each share
= 50000 x 10 = 500000
Number of common shares = 20000
The total profit of the company = $ 180000.
Amount kept in reserve fund = $ 30000
∴ Net amount paid as dividend to shareholders = The total profit of the company - reserve fund
= $ (180000 - 30000) = $ 150000
Dividend paid by the company on 50000 preferred shares
= 20% of Total number of preferred shares= $ 500000 x 20 = $ 100000 100
∴ Dividend to be paid to common shareholders = Net amount paid as dividend to shareholders - Dividend paid by the company on 50000 preferred shares
= $ (150000 - 100000) = $ 50000.
Thus, dividend paid on a common share= $ Dividend to be paid to common shareholders Number of common shares = $ 50000 = $ 2.50 20000
Hence, dividend percent paid on a common share= dividend paid on a common share x 100% Face value of one share = $ 2.50 x 100 % = 25% 10
- A medicine company issued 125000 shares of par value $ 20 each. If the total dividend declared by the company is $ 375000, find out the rate of dividend paid by the company.
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∵ Rate of dividend paid by the company = Total dividend x 100 % Total par value
Correct Option: A
Given that :- Number of shares = 125000
Par value of a share = $ 20
∴ Total par value of 125000 shares = Number of shares x Par value of a share
Total par value of 125000 shares = $ (1250000 × 20) = $ 2500000
Total dividend = $ 375000∴ Rate of dividend paid by the company = Total dividend x 100 % Total par value Rate of dividend paid by the company = 375000 x 100 % = 15 % 2500000
- A company issued 50000 shares of par value $ 10 each. If the total dividend declared by the company is $ 62500, then find out the rate of dividend paid by the company.
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∵ Rate of dividend paid by the company = Total dividend x 100 % Total par value
Correct Option: B
Given:- Number of shares = 50000
Par value of a share = $ 10
∴ Total par value of 50000 shares = Number of shares x Par value of a share
Total par value of 50000 shares = $ 50000 x 10 = $ 500000
Total dividend = $ 62500∴ Rate of dividend paid by the company = Total dividend x 100 % Total par value Rate of dividend paid by the company = 62500 x 100 % = 12 1 % 500000 2
