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Profit Sharing Pays Out of Net Profits While Gain-Sharing Pays

question 48

True/False

Profit sharing pays out of net profits while gain-sharing pays out of new savings or "gains".


Definitions:

Dividend-to-Earnings Ratio

The dividend-to-earnings ratio indicates what portion of a company's earnings is paid out as dividends to shareholders, reflecting the company's dividend payout policy.

Target Payout Ratio

A firm’s long-term desired dividend–earnings ratio.

Dividend Yield

A financial ratio that shows how much a company pays out in dividends each year relative to its stock price.

Price Range

The spread between the lowest and highest prices at which a commodity or asset is traded over a certain period of time.

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