A company with 10000 shares of nominal value of ₹100 declares an annual dividend of 8% to the share holders.

(i) Calculate the total amount of dividend paid by the company

(ii) Ramesh bought 90 shares of the company at ₹150 per share.

Calculate the dividend he received and the percentage return on his investment.

(i)
No. of shares = 10000

Nominal Value per share = ₹100

Rate of Dividend = 8%

Annual Dividend = No. of shares x Rate of Dividend x Nominal Value per share

$= 10000 \times \dfrac{8}{100} \times 100 \\[0.5em] = ₹80000$

∴ Total amount of dividend paid by the company = ₹80000

(ii)
No. of shares Ramesh bought = 90

Nominal Value per share = ₹100

Rate of Dividend = 8%

Annual Dividend = No. of shares x Rate of Dividend x Nominal Value per share

$= 90 \times \dfrac{8}{100} \times 100 \\[0.5em] = ₹720$

∴ Dividend Ramesh received = ₹720

Total investment of Ramesh = 90 x 150 = ₹13500

$\% \text{Return} = \Big(\dfrac{\text{Annual Inc.}}{\text{Investment}} \times 100\Big)\% \\[0.5em] = \Big(\dfrac{720}{13500} \times 100\Big) \% \\[0.5em] = \Big(\dfrac{720}{135} \Big) \% \\[0.5em] = \Big(\dfrac{16}{3} \Big) \% \\[0.5em] = \bold{5\frac{1}{3}\%}$