Partridge,Inc.provides the following information for 2017: $$\begin{array} { | l | l | }
\hline \text { Net income } & \$ 33,000 \
\hline \text { Market price per share of common stock } & \$ 13 / \text { share } \
\hline \text { Dividends paid } & \$ 0,90 / \text { share } \
\hline \text { Common stock outstanding at Jan. } 1,2017 & 110,000 \text { shares } \
\hline \text { Common stock outstanding at Dec. } 31,2017 & 155,000 \text { shares } \
\hline
\end{array}$$ The company has no preferred stock outstanding.Calculate the dividend yield for common stock.(Round your answer to two decimal places. )

Question

Partridge,Inc.provides the following information for 2017: $$\begin{array} { | l | l | } 
\hline \text { Net income } & \$ 33,000 \
\hline \text { Market price per share of common stock } & \$ 13 / \text { share } \
\hline \text { Dividends paid } & \$ 0,90 / \text { share } \
\hline \text { Common stock outstanding at Jan. } 1,2017 & 110,000 \text { shares } \
\hline \text { Common stock outstanding at Dec. } 31,2017 & 155,000 \text { shares } \
\hline
\end{array}$$ The company has no preferred stock outstanding.Calculate the dividend yield for common stock.(Round your answer to two decimal places. )

Quizplus · Accepted Answer

The dividend yield is calculated as the annual dividend per share divided by the market price per share. In this case, the annual dividend per share is $0.90 and the market price per share is $13. Therefore, the dividend yield is $0.90/$13 = 0.0692, or 6.92%.

Partridge,Inc The Company Has No Preferred Stock Outstanding