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    cwaller's Avatar
    cwaller Posts: 19, Reputation: 1
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    #1

    Oct 15, 2010, 10:26 AM
    Determining amount of dividend
    300,000 shares of common stock, authorized, 270,000 shares issued, and 100,000 shares of treasury stock. The company's board of directors declares a dividend of 50 cents per share of common stock. What is the total amount of dividend that will be paid
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #2

    Oct 15, 2010, 10:29 AM

    Since the company only pays dividends on shares that are outstanding you needto subtract the treasury stock from the issued stock and muliply that number by 50 cents.
    cwaller's Avatar
    cwaller Posts: 19, Reputation: 1
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    #3

    Oct 15, 2010, 10:34 AM
    Comment on pready's post
    Thank you I thought so but sometimes the wording is confusing.
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #4

    Oct 15, 2010, 10:35 AM

    Treasury stock means that the company repurchased the shares and that the shares are not outstanding.
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