Dear sir, i have a bit of problem with this extract
" since the most recent SOFP the company has declared a dividend of 5cents and this will be paid shortly. The ordinary shares have a par value of 25 cents and a market value of 66 cents".
In the answer to this Kaplan has used 66 cents as the cum div price and subtracted 5 cents to get ex div. Is this because the dividends have merely been declared and not paid yet? If the dividends would have already been paid then the 66 cents would be considered ex div rather than cum div?
can you please clarify this?
thankyou
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extract
8y ago#1Yes.
The cum div price is the price before the dividend has been paid. The ex div price is the price immediately after the dividend has been paid.
Please do watch my lectures, because I explain this in the lectures (and you cannot expect me to type out my lectures here :-) )
Thankyou so much!
8y ago#3You are welcome :-)
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