You purchased 200 shares of ABC stock on July 15^th. On July 20^th,you purchased another 100 shares and then on July 22^st you purchased your final 200 shares of ABC stock. The company declared a dividend of $1.10 a share on July 5^th to holders of record on Friday,July 23^rd. The dividend is payable on July 31^st. How much dividend income will you receive on July 31^st from ABC?

Question

Quizplus · Accepted Answer

The total number of shares owned as of the record date (July 23rd) is 500 (200+100+200). Therefore, the total dividend income would be 500 shares multiplied by the dividend of $1.10 per share, which equals $550. However, since the dividend was declared on July 5th, only the shares owned as of that date (200) are eligible to receive the dividend, which comes out to be $220. Therefore, the correct answer is C) $330, which is the dividend income received from the 300 additional shares purchased between July 5th and July 23rd.

You Purchased 200 Shares of ABC Stock on July 15th

You Purchased 200 Shares of ABC Stock on July 15^th