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12 October, 15:37

ABC issued 12,000 shares and subsequently reacquired 2,000 shares as treasury stock. The following year, ABC Corporation declared a regular dividend of $2 per share. What would be the total amount of the dividend expense

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  1. 12 October, 15:56
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    Dividend expense will be $20000

    Explanation:

    We have given share used = 12000 shares

    And Treasury stock = 2000 shares

    It is given a regular dividend of $2 per share

    We have to find the dividend stock

    Outstanding share = Share used - treasury stock = 12000 - 2000 = 10000 shares

    So dividend expense = $2*10000 = $20000

    So dividend expense will be $20000
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