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    bilby_jonathan's Avatar
    bilby_jonathan Posts: 3, Reputation: 1
    New Member
    		  
    #1

    Jun 2, 2007, 10:47 PM
    Dividend per share
    A company's board of directors votes to declare a cash dividend of $0.75 per share. The company has 15,000 shares authorized. 10,000 issued, and 9,500 shares outstanding. The total amount of the cash dividend is:

    A)$375.
    B)$4,125.
    C)$7,125.
    D)$7,500.
    E)$11,250.
    omsailogistic's Avatar
    omsailogistic Posts: 39, Reputation: -1
    Junior Member
    		  
    #2

    Jun 3, 2007, 02:44 AM
    The question has asked you to understand the concept of AUTHOIZED, ISSUED AND SUBSCRIBED SHARES ( OUTSTANDING SHARES )
    Authorized Shares = which the company is authorized to Issue
    Issued Shares = which are actually issued to public for subscription
    Outstanding
    or Subscribed = which has been applied by public or which are being
    represented by the Share Capital A/c

    The total amount of cash dividend = O/S shares * Dividend/share
    = 9500 * $ .075
    = $7125

    The correct answer is (C)
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