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How to calculate dividend? Urgent! Watch

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    Please look at the picture I have attached. The mark scheme says that the ordinary dividend paid is 6000+8000=14000
    I thought that you would do 100000*0.03=3000 and then 100000*0.05*0.08=4000
    So shouldn't the divide paid be 7000 instead?

    Thanks in advance.
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    The shares are 0.5 at par. The aggregate value is 100k. This means that there are 200k shares. 200k X 0.03 = 6k

    8% X 100k = 8k

    Together they make the 14k.

    On a more high level note you would expect retained earnings/reserves to increase by profit and reduce by dividend. Using the year on year movement and the profit of 26k you can easily balance for 14k which must be the dividend


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    (Original post by js93)
    The shares are 0.5 at par. The aggregate value is 100k. This means that there are 200k shares. 200k X 0.03 = 6k

    8% X 100k = 8k

    Together they make the 14k.

    On a more high level note you would expect retained earnings/reserves to increase by profit and reduce by dividend. Using the year on year movement and the profit of 26k you can easily balance for 14k which must be the dividend


    Posted from TSR Mobile
    Thank you very much
 
 
 
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