an important question from the book -ML aggarwal( avichal publication)class 10th , chapter3, shares and dividends.
we have been given that A company with 10000 shares of Rs. 100 each, declares an annual dividend of 5%.
now we are to find (i) What is the total amount of dividend paid by the company ?
(ii) What would be the annual income of a man, who has 72 shares, in the company ?
(iii) If he received only 4% on his investment, find the price he paid for each share.
please solve all parts separately in extensive manner. as question is very important as can be asked in exams.
Q no. 32, exercise 3, ML Publication, share and dividends
Nominal value of 1 share = Rs. 100
Nominal value of 10,000
shares = 10,000 × Rs. 100 = Rs. 10,00,000
(i) Dividend% = 5%
Dividend = 5% of Rs. 10,00,000
= (5/100) × Rs.10,00,000 = Rs. 50,000
(ii) Nominal value of 72 shares = Rs. 100 × 72 = Rs. 7,200
Dividend = 5% of Rs. 7,200 = (5/100) × Rs.7,200 = Rs. 360
(iii) Let market value of 1 share = Rs y
Then market value of 10,000 shares = Rs. (10,000y)
Return% = 4%
4% of Rs. (10,000y) = Rs. 50,000 ⟹ (4/100) ×10,000 = Rs.50,000 ⟹ y = Rs. 125.
we have been given that :-
Nominal value of 1 share = Rs. 100
Nominal value of 10,000 shares = 10,000 × Rs. 100 = Rs. 10,00,000
solution:-
(i) Dividend% = 5% Dividend
= 5% of Rs. 10,00,000
= (5/100) × Rs.10,00,000
= Rs. 50,000
(ii) Nominal value of 72 shares = Rs. 100 × 72
= Rs. 7,200 Dividend = 5% of Rs. 7,200
= (5/100) × Rs.7,200 = Rs. 360
(iii) Let market value of 1 share = Rs y
Then market value of 10,000 shares = Rs. (10,000y)
Return% = 4%
4% of Rs. (10,000y) = Rs. 50,000
⟹ (4/100) ×10,000
= Rs.50,000 ⟹ y = Rs. 125.