A company with 500 shares of nominal value ₹ 120 declares an annual dividend

A company with 500 shares of nominal value ₹ 120 declares an annual dividend of 15%. Calculate:

1. the total amount of dividend paid by the company.
2. annual income of Mr. Sharma who holds 80 shares of the company. If the return percent of Mr. Sharma from his shares is 10%, find the market value of each share.

Answer

i. Total amount of dividend paid by the company
= 5000 × 120 ×15/100 = ₹ 90,000

ii. Annual income of Mr. Sharma having 80 shares
= 80 × 120 × 15/ 100 = ₹ 1,440

Market value of 1 share × return % = Nominal value of 1 share × Dividend %
𝑥 ×10/100 = 120 × 15/100 ∴ 𝑥 = ₹ 180
Market value of 1 share = ₹ 180