Tito Corporation had net income of $2000000 and paid dividends to common stockholders of $300000 in 2021.The weighted average number of shares outstanding in 2021 was 400000 shares.Tito Corporation's common stock is selling for $50 per share on the NASDAQ.Tito Corporation's payout ratio for 2021 is

Question

Quizplus · Accepted Answer

The payout ratio is the ratio of dividends paid to net income. 
Payout ratio = Dividends paid / Net income 
Payout ratio = $300,000 / $2,000,000 = 0.15 
Therefore, the payout ratio for 2021 is 15%.

Tito Corporation Had Net Income of $2000000 and Paid Dividends