A company issued 120,000 fully paid, 5% preference shares priced at $2 each. The dividend to be paid on the shares for a financial year is:

Name: A company issued 120,000 fully paid, 5% preference shares priced at $2 each. The dividend to be paid on the shares for a financial year is:
Brand: Quizplus
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Question

Quizplus · Accepted Answer

The total value of preference shares issued is:

$2 × 120,000 = $240,000

The dividend to be paid on the shares is 5%, therefore the total dividend paid would be:

$240,000 × 0.05 = $12,000

Hence, the answer is D.

A Company Issued 120,000 Fully Paid, 5% Preference Shares Priced