QUESTION 4 Waterway Corporation had net income of 200000 and

QUESTION 4 Waterway Corporation had net income of $200000 and paid dividends to common stockholders of $25000 in 2017. The weighted average number of g in 2017 was 57000 shares. Waterway Corporation\'s common stock is selling for $70 per share on the New York Stock Exchange. Waterway Corporation\'s payout ratio for 2017 is 12.5% 16% S.04 per share 28.5%

Solution

Dividend payout ratio=Dividends payments/Net income

which is equal to

=(25000/200,000)

=12.5%