A company went public on January 1, 2015, with an initial public offering of 10,

Question

A company went public on January 1, 2015, with an initial public offering of 10,000,000 common shares, $1 par value, at a market price of $3 per share. In 2016, a 10% stock dividend was issued trading at $6 per share.  In 2017, a 3-for-1 forward stock split was executed  2017 trading at $12 per share. In 2018, 500,000 common shares were repurchased on the open market at a price of $15 per share.
Question is:

On December 31, 2018, the company declared and paid its first cash dividend of $0.1 per share on all outstanding common shares. What is the dividend?

Explanation / Answer

Calculate dividend :

Dividend = 32500000*.1 = $3250000

Share issued 10000000 Stock dividend (10000000*10%) 1000000 Total 11000000 Shares after stock split (11000000*3) 33000000 Less: Share repurchased -500000 Outstanding common shares 32500000

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