Dividend Payout Ratio The following numbers are for three different companies:

Required:
1. For each company, compute the dividend payout ratio.
2. Interpretive Question: Which of the three companies is most likely to be a highgrowth Internet company? Which is most likely to be an old, stable company? Explain.

Transcribed Image Text:

Cash Retained earnings Cash dividends Paid-in capital Total liabilities Sales Net income A B C $ 300 $ 500 $ 700 900 1,000 4,100 0 100 600 3,200 2,000 2,500 800 900 700 8,000 6,000 7,000 400 700 900