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Step2247 [10]
3 years ago
7

Fastlane Company has 50,000 shares of common stock and 20,000 shares of preferred stock outstanding. There was no change in the

number of common or preferred shares outstanding during the year. Preferred stockholders received dividends this year totaling $120,000. Common stockholders received dividends totaling $200,000. If the dividend payout ratio for the year was 80%, then the net income was:_____.
a. $400,000.
b. $370,000.
c. $160,000.
d. $250,000.
Business
1 answer:
gavmur [86]3 years ago
5 0

Answer:

Option b is correct

Net income = $370,000

Explanation:

Dividend paid to common stock holders = Dividend payout ratio× earnings available to common stockholder

Let the total earnings be "y"

120,000 =80%×  y

y = 120,000/0.8

y= 250,000

Net income = Earnings payable to common stockholders + Preferred dividend

Net income = 250000  + 120,000 = $370,000

Net income = $370,000

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Miller Corporation issued 6000 shares of its​ $5 par value common stock in payment for attorney services billed at​ $54,000. Mil
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Explanation:

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The $24,000 credit to share premium represents the difference between the nominal value of the share of $5 and the market value of $9 multiply by the 30,000 shares he was paid with.

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3 years ago
T 1: Human Resources Management​
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2 years ago
Four students are storing this fact: "europeans first settled at st. augustine, florida, in 1565." which student is probably goi
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The student who is probably going to have the most difficult time retrieving the information from long-term memory a few days later would be: “Alexander who repeats the fact to himself 10 times in a row.”  

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3 years ago
Two firms, A and B, each currently dump 50 tons of chemicals into the local river. The government has decided to reduce the poll
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Answer:

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3 years ago
Read 2 more answers
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