Suppose a Firm Pays Total Dividends of $489,000 Out of Net

question 23

Multiple Choice

Suppose a firm pays total dividends of $489,000 out of net income of $5 million. What would the firm's retention ratio be?

• A) 9.78%
• B) 90.22%
• C) 81.24%
• D) 19.78%

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Definitions:

Personal Property

Movable assets or belongings, excluding real estate, owned by an individual or entity.

Common Carriers

Companies or entities that provide transportation services to the public under the authorization or regulation of a governmental body.

Liability

Legal responsibility for one's actions or inactions, which may lead to legal or financial penalties.

Bailed Goods

Goods that are delivered to a party (the bailee) for a specified purpose under a contract of bailment, without transfer of ownership.