Question

A company declared an annual dividend of 10% . Find the annual dividend of a shareholder owning 1,500 shares of the company of par value Rs. 10 each.

Answer 1

Step 1: Given information:

Par value $=\mathrm{Rs}.10$
Annual dividend on one share$=10\%\mathrm{of}\mathrm{par}\mathrm{value}$

Step 2: Calculate the annual dividend on one share

$\begin{array}{rcl}\mathrm{Annual}\mathrm{dividend}\mathrm{on}\mathrm{one}\mathrm{share}& =& 10\%\mathrm{of}\mathrm{par}\mathrm{value}\\ & =& 10\times \frac{10}{100}\\ \therefore \mathrm{Annual}\mathrm{dividend}\mathrm{on}\mathrm{one}\mathrm{share}& =& \mathrm{Rs}.1\end{array}$

Step 3: Calculate the annual dividend on 1500 shares
The annual dividend of shareholder owning 1500 shares is,

$\begin{array}{rcl}\mathrm{Annual}\mathrm{dividend}& =& 1,500\times \mathrm{Annual}\mathrm{dividend}\mathrm{on}\mathrm{one}\mathrm{share}\\ & \Rightarrow & \mathrm{Annual}\mathrm{dividend}=1,500\times 1\\ \therefore \mathrm{Annual}\mathrm{dividend}& =& \mathrm{Rs}.1,500\end{array}$

Hence, the annual dividend of shareholder owning 1500 shares is Rs. 1,500.