Question

Mr. Trivedi invested Rs. 45,000 in shares of face value Rs. 100 at market value Rs. 125. If the company declared 30% dividend at the end of the year, what was the income from dividend?

Answer 1

Given:

Investment = Rs. 45,000

Face value (FV) = Rs. 100

Market value (MV) = Rs. 125

Dividend declared = 30%

Step-wise calculation:

1. Number of shares = Investment ÷ MV

= 45,000 ÷ 125

= 360 shares

2. Dividend per share = FV × 30%

= 100 × 0.30

= Rs. 30 per share

3. Total dividend income = Number of shares × Dividend per share

= 360 × 30 

= Rs. 10,800

Income from dividend = Rs. 10,800.