Financial Accounting

Learn the toughest concepts covered in your Financial Accounting class with step-by-step video tutorials and practice problems.

Financial Statement Analysis

Ratios: Dividend Yield Ratio

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Ratios: Dividend Yield Ratio

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Problem

During the current year, PayCo declared and paid a cash dividend of $600,000. The number of shares of common stock outstanding is 1,000,000. If the current market price of the stock is $15, what is the dividend yield ratio?

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Problem

ABC Company’s common stock currently has a market price of $20, while total stockholders’ equity has a book value of $600,000 (60,000 shares outstanding). During the current year, ABC Company maintained a dividend yield ratio of 8%. What was the total amount of dividends paid to common stockholders?