What Kind of Information Does the Dividend Payout Ratio Provide

question 33

Multiple Choice

What kind of information does the dividend payout ratio provide?

• A)How much dividend revenue a company earns on its short- term investments
• B)How much profit each shareholder makes when he sells his shares
• C)What proportion of a share's earnings are paid out in dividends
• D)How much the dividend is in proportion to the share's market price

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Definitions:

Predetermined Overhead Rate

A rate used to apply manufacturing overhead to products or job orders, calculated before the period begins based on estimated costs.

Variable Manufacturing Overhead

Costs incurred during the production process that vary with the level of production, such as utilities for the manufacturing plant.

Direct Labor-Hours

A measure of the labor time directly involved in the production of goods or services, typically used as a basis for allocating manufacturing overhead costs.

Predetermined Overhead Rate

An estimated rate used to assign manufacturing overhead costs to products based on a certain activity (e.g., machine hours).