Answer:
1)Dividend per share = 1
2)Dividend yield = 5%
3)Dividend payout ratio = 0.39
Explanation:
As per the data given in the question,
Net sale = $5,345,000
Cost of goods sold = $3,474,250
Gross margin = $5,345,000 - $3,474,250 = $1,870,750
Operating expenses = $1,140,300
Operating income = $1,870,750 - $1,140,300 = $730,450
Interest expenses = $27,000
Income before taxes = $730,450 - $27,000 = $703,450
Income tax(40%) = $281,380
Net in come = $422,070
Preference of dividend = $40,000
Earnings available to common stockholders = $422,070 - $40,000 =$382,070
Common stock = $150,000
Earning per share = $382,070÷$150,000 = 2.55
Dividend to common stockholders = $150,000
Dividend per share = $150,000÷$150,000 = 1
Market price of common share = $20
Dividend yield = (Dividend per share×100÷market price of common share) = 5%
Dividend payout ratio = Dividend per share÷earning per share =1÷2.55 = 0.39
