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20 April, 01:44

Bvi corporation had net income of $1,600,000 and paid dividends to common stockholders of $400,000 in 2014. the weighted average number of shares outstanding in 2014 was 500,000 shares. bvi corporation's common stock is selling for $50 per share on the nasdaq. bvi corporation's payout ratio for 2014 is

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  1. 20 April, 05:23
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    Calculation of Bvi corporation's payout ratio for 2014:

    The formula to calculate the Payout ratio is as follows:

    Payout Ratio = (Total Divided Paid / Net Income) * 100

    Bvi corporation's payout ratio for 2014 can be calculated as follows:

    Payout Ratio = (Total Divided Paid / Net Income) * 100

    = (400000/1600000) * 100

    = 0.25*100

    =25%

    Hence, Bvi corporation's payout ratio for 2014 is 25%
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