Question : Profit in an organization is equal to Rs. 500000 after interest, tax, and dividends on preferred shares. There are 50,000 equity shares and a 50% dividend payout ratio. What amount of dividend payment will there be?
Option 1: Rs. 5
Option 2: Rs. 25
Option 3: Rs. 10
Option 4: Rs. 12
Correct Answer: Rs. 5
Solution : Earning Per Share = 5,00,000/50,000 = 10 Dividend payout = Earning Per Share× dividend payout rate = 5 Dividend payout = 10 × 50% = 5 Hence option 1 is the correct answer.
Question : 9% preference shares of 10 each Rs. 5,00,000, Equity shares of 10 each Rs.1,20,000, Profit after tax Rs.4,20,000, Equity dividend paid 20%, Market price of equity shares Rs.25 each. What will be the earnings per share?
Option 1: 3.20
Option 2: 3.30
Option 3: 3.125
Option 4: 3.32
Question : The Debt-Equity Ratio of a Company is 1:2. State the transaction by which it would increase to 3:1.
Option 1: Repayment of Long term Borrowings of Rs. 40,000 .
Option 2: Purchased a Fixed Asset for Rs.50,000 on long-term deferred payment basis.
Option 3: Issued new equity shares of Rs.75,000.
Option 4: Payment of Dividend Payable.
Question : A man invests Rs. 44,000 in some shares in the ratio 1 : 4 : 5 which pay dividends of 10%, 15%, and 25% on his investment for one year, respectively. His total dividend income is:
Option 1: Rs. 7,850
Option 2: Rs. 8,580
Option 3: Rs. 7,970
Option 4: Rs. 8,510
Question : Which of the following statements is true?
Option 1: Net Profit after tax means Net Profit after interest and tax
Option 2: Net Profit after tax means Net Profit after interest and before tax
Option 3: Net Profit after tax means Net Profit before interest and after tax
Option 4: Net Profit after tax means Net Profit before interest and before tax
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