Excerpts from Goodrow Corporation's most recent balance sheet and income statement appear below: Dividends on common stock during Year 2 totaled $20 thousand. Dividends on preferred stock totaled $10 thousand. The market price of common stock at the end of Year 2 was $5.34 per share.
-The dividend yield ratio for Year 2 is closest to:
A)2.81%
B)66.67%
C)1.87%
D)0.94%

Question

Excerpts from Goodrow Corporation's most recent balance sheet and income statement appear below:   Dividends on common stock during Year 2 totaled $20 thousand. Dividends on preferred stock totaled $10 thousand. The market price of common stock at the end of Year 2 was $5.34 per share.
-The dividend yield ratio for Year 2 is closest to:
A)2.81% 
B)66.67% 
C)1.87% 
D)0.94%

Quizplus · Accepted Answer

Number of common shares outstanding = Common stock F1F1F1S1F1F1F10 Par value
= $400 F1F1F1S1F1F1F10 $2 per share = 200 shares
Dividends per share = Common dividends F1F1F1S1F1F1F10 Common shares
= $20 F1F1F1S1F1F1F10 200 shares = $0.10 per share
Dividend yield ratio = Dividends per share F1F1F1S1F1F1F10 Market price per share
= $0.10 per share F1F1F1S1F1F1F10 $5.34 per share = 1.87%

Excerpts from Goodrow Corporation's Most Recent Balance Sheet and Income