The Following Information Pertains to Jasmin Corporation Jasmin Corporation Had 6,000 Shares of Common Stock Issued and Balance

question 67

Multiple Choice

The following information pertains to Jasmin Corporation. Assume that all balance sheet amounts represent both average and ending figures. $\begin{array}{|l|l|}\hline \text { Jasmin Corporation } \\\hline \text { Partial Balance Sheet } \\\hline \text { December 31, 20xx } \\\hline \text { Liabilities and Stockholders' Equity } \\\hline \text { Current liabilities } & \$ 60,000 \\\hline \text { Long-term liabilities } & 90,000 \\\hline \text { Stockholders' equity } & 150,000 \\\hline \text { Total liabilities and stockholders' equity } & \$ 300,000 \\\hline\end{array}$

$\begin{array}{|l|r|}\hline \text { Jasmin Corporation } \\\hline \text { Income Statement } \\\hline \text { For the Year Ended December } 31,20 \mathrm{xx} \\\hline \text { Net sales } & \$ 80,000 \\\hline \text { Cost of goods sold } & 45,000 \\\hline \text { Gross margin } & \$ 35,000 \\\hline \text { Operating expenses } & 15,000 \\\hline \text { Income before income taxes } & \$ 20,000 \\\hline \text { Income taxes expense } & 5.000 \\\hline \text { Net income } & \$ 15,000 \\\hline\end{array}$ Jasmin Corporation had 6,000 shares of common stock issued and outstanding. The market price of Jasmin common stock on December 31, 20xx, was $20. Jasmin paid dividends of $1.25 per share during 20xx.
-
What is the dividends yield of this corporation? Round your answer to two decimal places.

• A) 6.25 percent
• B) 5.00 percent
• C) 7.50 percent
• D) 3.75 percent

---

Definitions:

Equity Method

The equity method is an accounting technique used by firms to assess the profits earned by their investments in other companies by reporting these profits in proportion to their ownership.

Net Income

The total profit of a company after all expenses, taxes, and costs have been deducted from total revenue. It indicates the company's financial performance over a specified period.

Owned Subsidiary

A company whose majority of shares is held by another company, making it controlled by the parent company.

Intra-entity Gross Profit

Profits arising from transactions within the same entity, requiring elimination during the consolidation process to avoid overstatement of revenues.