Union Pacific Corporation Union Pacific’s statement of shareholders’ equity for the year 2005 is reproduced below.

1. Based on the dividends paid during 2005, how many shares of stock were outstanding when the dividends were paid?
2. Why isn’t the number of shares receiving dividends exactly the same as the number of shares outstanding on December 31 as indicated in the statement?
3. Compute Union Pacific’s dividend payout ratio for each year. Has that number increased or decreased over time?

Transcribed Image Text:

Accumulated Other Comprehensive Income/(Loss) Millions of Dollars Thousands of Shares Balance at Jan. 1, 2003 Comprehensive income/(loss): Net income Other comp. income/(loss) from continuing operations [a] Other comp. income/(loss) from discontinued operations [b] Total comprehensive income/(loss) Conversion, exercises of stock options, forfeitures, and other Dividends declared ($0.99 per share) Balance at Dec. 31, 2003 Comprehensive income/(loss): Common Treasury Common Paid-In- Retained Treasury Shares Shares Shares Surplus Earnings Stock Minimum Foreign Pension Currency Adj. Liability Trans. Derivative Adj. Adj. Total 275,579 (21,920) $ 689 $ 3,946 $ 7,597 $ (1,347) $ (232) $ (9) - 1,585 = 1,585 114 4,388 (10) - 270 (252) - - $ 7 $ 10,651 1,585 39 (9) (4) 26 84 84 123 (9) (4) 1,695 275,693 (17,532) $ 689 $ 3,936 $ 8,930 $ (1,077) $ (109) 260 (252) $ (18) $3 $12,354 Net income Other comp. income/(loss) [a] Total comprehensive income/(loss) 604 - 604 (103) (10) (113) 604 (103) (10) 491