The payout ratio is computed by dividing
A)total cash dividends paid to common stockholders by retained earnings.
B)dividends paid per share by net income.
C)total cash dividends paid to common stockholders by net income.
D)dividends paid per share by year-end stock price.

Question

Quizplus · Accepted Answer

The payout ratio is calculated by dividing the total cash dividends paid to common stockholders by the net income, indicating the proportion of earnings distributed as dividends.

The Payout Ratio Is Computed by Dividing