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Mathematics

A company pays a dividend of 15% on its ten-rupee shares from which it deducts income tax at the rate of 22%. Find the annual income of a man who owns one thousand shares of this company?

Shares & Dividends

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Answer

Annual income = No. of shares × Rate of div. × N.V. of 1 share

= 1000×15100×101000 × \dfrac{15}{100} \times 10

= ₹ 1,500.

Income tax = 22% = 22100×1,500=330\dfrac{22}{100} \times 1,500 = ₹ 330.

Net income = ₹ 1,500 - ₹ 330 = ₹ 1,170.

Hence, net annual income = ₹ 1,170.

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