Last year, Blakely's Fashions earned net income of $68,400 and had 12,000 shares of stock outstanding. The dividends per share were $2.20. What is the dividend payout ratio?
A) 32.98 percent
B) 34.00 percent
C) 38.60 percent
D) 40.21 percent
E) 44.14 percent

Question

Quizplus · Accepted Answer

Dividend payout ratio = Total dividends / Net income 
Total dividends = Dividends per share × Number of shares outstanding = $2.20 × 12,000 = $26,400 
Dividend payout ratio = $26,400 / $68,400 = 0.3860 = 38.60%

Last Year, Blakely's Fashions Earned Net Income of $68,400 and Had