What will be the companys dividend payout ratio in 2012

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Reference no: EM13336251

Bowles Sporting Inc. is prepared to report the following 2012 income statement

Sales $12,700
Operating costs including depreciation 9,906
EBIT $2,794
Interest 264
EBT $2,530
Taxes (40%) 1,012
Net income $1,518

Prior to reporting this income statement, the company wants to determine its annual dividend. The company has 340,000 shares of stock outstanding, and its stock trades at $54 per share.

The company had a 50% dividend payout ratio in 2011. If Bowles wants to maintain this payout ratio in 2012, what will be its per-share dividend in 2012?

If the company maintains this 50% payout ratio, what will be the current dividend yield on the company's stock?

The company reported net income of $1.25 million in 2011. Assume that the number of shares outstanding has remained constant. What was the company's per-share dividend in 2011?

As an alternative to maintaining the same dividend payout ratio, Bowles is considering maintaining the same per-share dividend in 2012 that it paid in 2011. If it chooses this policy, what will be the company's dividend payout ratio in 2012?

Reference no: EM13336251

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