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Hey! I’m confused about how to calculate dividends paid out for example;
“A company has the following share capital:
Authorised($000): 8,000 and Issued($000): 4,000 – 25c ordinary shares
Authorised($000):2,000 and Issued($000): 1,000 – 6% 50c preference shares.
In addition to providing for the year’s preference dividend, an ordinary dividend of 2c per share is to be paid.”
Please help!- Topics: 0
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Ordinary shares : Total value $4,000,000 -25c each, so there are 16,000,000 shares issued. Each share is entitled to 2c , therefore total ordinary dividend will be $320,000.
Preference shares Total value $1,000,000 50c each, so there are 2,000,000 preference shares issued. Eacj preference share is entitled to 0.08 X 50c = 4c, therefore total preference share dividend will be $80,000.
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