What is the payout ratio also known as?

Understanding Payout and Retention Ratios

Interactive Video
•
Mathematics, Business
•
9th - 12th Grade
•
Hard

Sophia Harris
FREE Resource
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10 questions
Show all answers
1.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Earnings retention ratio
Net income ratio
Dividend payout ratio
Dividend retention ratio
2.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
How do you calculate the payout ratio?
Dividends divided by retained earnings
Retained earnings divided by net income
Total dividends paid divided by annual net income
Net income divided by dividends
3.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
If a company has a payout ratio of 20%, what is its retention ratio?
80%
20%
60%
40%
4.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What is the payout ratio for a company that pays 40 million in dividends with a net income of 100 million?
20%
40%
60%
80%
5.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What is the retention ratio if a company retains 80 million out of 100 million net income?
80%
60%
40%
20%
6.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What happens when a company's payout ratio exceeds 100%?
The company is expanding its operations
The company is sustainable
The company is paying more dividends than its earnings
The company is retaining more earnings
7.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Why is a payout ratio above 100% considered unsustainable?
Because the company is retaining earnings
Because the company is paying off debt
Because the company is losing money
Because the company is gaining money
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