need the concept of shares and dividents plss easy
Answers
Answer:
A dividend is a payment made by a corporation to its shareholders, usually as a distribution of profits. ... Retained earnings (profits that have not been distributed as dividends) are shown in the shareholders' equity section on the company's balance sheet – the same as its issued share capital.
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Step-by-step explanation:
Shares and dividend is all just about the commercial type of maths.
Every ICSE student has a doubt in this lesson, even I had but this is easy chapter!!
It is the number of dividends each shareholder of a company receives on a per-share basis. Ordinary shares, or common shares, are the basic voting shares of a corporation. Shareholders are usually allowed one vote per share and do not have any predetermined dividend amounts
The original value of a share printed in the certificate of the share is called its face value or nominal value (in short, NV). The NV of a share is also known as register value, printed value and par value. The price at which the share is sold or purchased in the capital market through stock exchanges is called its market value (in short, MV).
A share is said to be:
At premium or Above par, if its market value is more than its face value.
At par, if its market value equals its face value.
At discount or Below par, if its market value is less than its face value.
The share of a company that is doing well or expected to do well is sold in the market at a price higher than its NV. In such a situation, we say the share is at premium or above par. For example, if a share of NV of Rs 10 is selling at Rs 16 then the share is at a premium of Rs 6. The share of a company that is neither doing well nor poorly is sold in the market at a price equal to its NV. For example, if a share of NV of Rs 100 is selling at Rs 100 then the share is at par. The share of a company that is doing poorly or may do poorly in the future is sold in the market at a price lower than its NV. In such a case, we say the share is at a discount or below par. For example, if a share of NV of Rs 100 is selling at Rs 80 then the share is at a discount of Rs 20.
Mainly formulae are important here and nothing else.
1) No. of shares = Sum invested/Market Value of 1 share.
Also,
Total dividend/dividend on 1 share
Also,
Total income(profit)/income(profit)
2) Sum invested = Number of shares x Market value of 1 share
3) Annual dividend = Dividend% x Face value x Number of shares
4) Rate of dividend = Income /investment
The statement r% Rs 100 shares at Rs M means the following:
The NV of a share is Rs 100.
The MV of a share is Rs M.
The dividend on a share is r% of NV, i.e., Rs r per annum.
An investment of Rs M gives an annual income of Rs r.
Rate of return per annum = Annual income from an investment of Rs 100 =(\dfrac{Income}{Investment} \times 100) \%=(\dfrac{r}{M} \times 100)\%
Look at the statement given below:
9% Rs 100 shares at Rs 120 means
Face value (NV) of 1 share = Rs 100.
Market value (MV) of 1 share = Rs 120.
The dividend on a share is 9% of its face value = 9% of Rs 100 = Rs 9
An investment of Rs 120 gives an annual income of Rs 9.
Rate of return per annum = Annual income from an investment of Rs 100 =(\dfrac{Income}{Investment} \times 100) \%=(\dfrac{9}{120} \times 100) \%=7\dfrac{1}{2} \%
NOTE: The face value of a share remains the same. The market value of a share changes from time to time.
JUST CONCENTRATE ON ALL TYPES OF FORMULA BE CLEAR, AND DONOT WORRY BASICALLY EASY QUESTIONS ARE ASKED FROM THIS CHAPTER. BE THOROUGH WITH THE PAST YEAR QUESTIONS THOSE MODELS ARE ASKED.