Sum
Calculate the percentage income in the following investments:
Rs 36,250 in a Rs 125 share paying 8% and available at a premium of Rs 20.
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Solution
Investment= Rs 36,250
Nominal value of each share =Rs 125
Market value =Rs ( 125 +Rs 20) =Rs 145
No. of shares purchased = `36250/145 = 250`
Face value of 250 shares = Rs 125 x 250 = Rs 31,250
Dividend = 8 %
Therefore, Annual Income = `(8 xx 31250)/100` = Rs 2500
Hence, percentage income = `(2500 xx 100)/36250 = 6.9 %`
Concept: Shares and Dividends
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