Presented below are selected data from the financial statements of Carnival Corp.for 2018 and 2017. $\begin{array}{lrr}&2018&2017\
\text { Net income } & \$ 110,000 & \$ 123,000 \
\text { Cash dividends paid on common stock } & \$ 42,000 & \$ 38,000 \
\text { Market price per share of common stock at the end of the year } & \$ 16.00 & \$ 13.00 \
\text { Shares of common stock outstanding } & 140,000 & 140,000
\end{array}$
The dividend yield ratio for 2018 is

A)1.9%.
B)2.1%.
C)36.3%.
D)38.1%.

Question

Presented below are selected data from the financial statements of Carnival Corp.for 2018 and 2017.  $\begin{array}{lrr}&2018&2017\
\text { Net income } & \$ 110,000 & \$ 123,000 \
\text { Cash dividends paid on common stock } & \$ 42,000 & \$ 38,000 \
\text { Market price per share of common stock at the end of the year } & \$ 16.00 & \$ 13.00 \
\text { Shares of common stock outstanding } & 140,000 & 140,000
\end{array}$
The dividend yield ratio for 2018 is

A)1.9%.
B)2.1%.
C)36.3%.
D)38.1%.

Quizplus · Accepted Answer

The dividend yield ratio is calculated as (Dividends per share / Market price per share) * 100. For 2018, Dividends per share = $42,000 / 140,000 = $0.30. The market price per share is $16.00. Thus, the dividend yield ratio = ($0.30 / $16.00) * 100 = 1.875%, which rounds to 1.9%.

Presented Below Are Selected Data from the Financial Statements of Carnival