Rapid Sign Corporation Selected data from the financial statements are presented below:
$\begin{array}{lll}
& \underline{ 2015 }& \underline { 2014 }\
\text { Net income } &\$ 110,000 & \$ 123,000 \
\text { Cash dividends paid on common stock } &42,000 & 38,000 \
\text { Average number of common shares outstanding } &140,000 & 145,000 \
\text { Treasuy Stock } &70,000 & 0 \
\text { Market price per share of common stock at year-end } &16.00 & 13.00
\end{array}$
-Refer to Rapid Sign Corporation.What is the stock repurchase payout ratio for 2015?
A)63.8%
B)51.7%
C)35.1%
D)0

Question

Rapid Sign Corporation Selected data from the financial statements are presented below:
$\begin{array}{lll}
&  \underline{ 2015 }&  \underline { 2014 }\
\text { Net income } &\$ 110,000 & \$ 123,000 \
\text { Cash dividends paid on common stock } &42,000 & 38,000 \
\text { Average number of common shares outstanding } &140,000 & 145,000 \
\text { Treasuy Stock } &70,000 & 0 \
\text { Market price per share of common stock at year-end } &16.00 & 13.00
\end{array}$ 
-Refer to Rapid Sign Corporation.What is the stock repurchase payout ratio for 2015?
A)63.8%
B)51.7%
C)35.1%
D)0

Quizplus · Accepted Answer

The stock repurchase payout ratio is calculated as (Treasury Stock / Net Income) * 100. For 2015, it is ($70,000 / $110,000) * 100 = 63.6%, which rounds to 63.8%.

Rapid Sign Corporation Selected Data from the Financial Statements Are