322Firms employ various dividend policies. Financial managers need to consider various elementswhen deciding on which dividend policy is the best for the firm.Required:Explain how each of the below factors might influence the dividend policy of the company. Youwill need to do some additional research. (Always ensure you use the IIE Harvard Referencingmethod.)• Investment/Growth Opportunities;• Profitability;• Retained Earnings-to-total Equity;• Borrowing Ratio;• Age of the company.

322Firms employ various dividend policies. Financial managers need to consider various elementswhen deciding on which dividend policy is the best for the firm.Required:Explain how each of the below factors might influence the dividend policy of the company. Youwill need to do some additional research. (Always ensure you use the IIE Harvard Referencingmethod.)• Investment/Growth Opportunities;• Profitability;• Retained Earnings-to-total Equity;• Borrowing Ratio;• Age of the company.

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter9: Metric-analysis Of Financial Statements

Section: Chapter Questions

Problem 12CDQ

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FINANCE2A First Question
Quiz 2: Solvency Debt-to-equity ratio Times interest earned ratio Debt service coverage ratio Cash flow from operations to capital expenditures ratio Profitability Return on assets ratio Return on sales ratio Asset turnover ratio Return on common stockholders equity ratio Leverage Earnings per share (EPS) Price/earnings (P/E) ratio Dividend payout ratio Dividend yield ratio A measure of a companys success in earning a return for the common stockholders. The relationship between a companys performance according to the income statement and its performance in the stock market. The ability of a company to remain in business over the long term. A variation of the profit margin ratio; measures earnings before payments to creditors. A companys bottom line stated on a per-share basis. The percentage of earnings paid out as dividends. The ratio of total liabilities to total stockholders equity. A measure of the ability of a company to finance long-term asset acquisitions with cash from operations. A measure of a companys success in earning a return for all providers of capital. The relationship between net sales and average total assets. The relationship between dividends and the market price of a companys stock. The use of borrowed funds and amounts contributed by preferred stockholders to earn an overall return higher than the cost of these funds. An income statement measure of the ability of a company to meet its interest payments. A statement of cash flows measure of the ability of a company to meet its interest and principal payments. How well management is using company resources to earn a return on the funds invested by various groups.