The Following Are the Income Statements and Balance Sheets for Thomas

question 79

Multiple Choice

The following are the income statements and balance sheets for Thomas Company: $\begin{array}{lr}&20X9\\\text { Sales only credit sales) } & \$ 1,606.0 \\\text { Less cost of goods sold } & \underline{1,062.0}\\\text { Gross profit } & \$ 544.0 \\\text { Less operating expenses } & 322.0\\\text { Operating income } & \$ 222.0 \\\text { Less other expense: Interest } & 9.6\\\text { Income before tax } & \$ \overline{212.4} \\\text { Lessincome tax expense } & {85.0} \\\text { Net income } & \$ {127.4}\end{array}$ $\begin{array}{lrrlrr}&20X9&20X8&&20X9&20X8\\\text { Current assets: } &&&{\text { Current liabilities: }} \\\text { Cash } & \$ 36 & \$ 38 & \text { Accts payable } & \$ 98 & \$ 64 \\\text { Accts receivable } & 180 & 144 & \text { Wages payable } & 18 & 16 \\\text { Inventory } & 120 & 100 & \text { Taxes payable } & 28 & 4 \\\text { Prepaid rent } & 20 & 24 & \text { Current portion } & &\\\text { Total current assets }&\$356&\$306&\text { of long-term debt }&30&6\\\text { Long-term assets: } & & & \text { Total current } & & \\\text { Fixed assets } & \$ 320 & \$ 316 & \text { liabilities } & \$ 174 & \$ 90 \\\text { Accum. deprec. } & \underline{206}) & \underline{180}) & \text { Long-term liabilities } & \underline{66} & \underline{92}\\\text { Total long-term assets }&\$114&\$136&\text { Total liabilities }&\$240&\$182\\&&&\text { Owners' equity: }\\&&&\text { Common stock, } \$ 5 \text { par }&\$80&\$80\\&&&\text { Retained income } & 150 & 180\\&&&\text { Total owners' equity }&\$230&\$260\\\text { Total assets }&\$470&\$442&\text { Total liab. and own. equity }&\$470&\$442\\\\\end{array}$
$\text {December 31 market price per share:}\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\$120\quad\quad\$106$ The dividend?payout ratio for Thomas Company in 20X9 is _____.

• A)24.1%
• B)103.7%
• C)105.0%
• D)123.5%

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Definitions:

Sympathetic System

Part of the autonomic nervous system that activates the body's rapid involuntary response to dangerous or stressful situations (fight or flight response).

Parasympathetic Branch

Part of the autonomic nervous system responsible for stimulating "rest-and-digest" or "feed and breed" activities that occur when the body is at rest.

Type A Characteristics

Personality traits including competitiveness, impatience, and a sense of urgency, often linked to stress and heart disease.

Hyperarousal

A condition of increased psychological and physiological tension marked by such effects as reduced pain tolerance, anxiety, and exaggerated startle reflex.