4. Dividendpractices In general, firms' dividend practices fit into the categories listed in the following table (constant payout ratio, low regular dividend plus extras, residual dividend policy, and stable, predictable dividend policies). Identify the category that each practice corresponds to in the table. Practice Globo-Chem Co. sets its dividend rather conservatively, but supplemental dividends are periodically issued when it finds itself with excess funds. St. Mildred's Brewing Co.'s dividends represent the portion of earnings left after it has made all profitable investments. Spentworth Industries Inc.'s investors like the firm's dividend policy because the firm pays the same dividend every year no matter how the firm performs. Extensive Enterprises Inc. pays out a set percentage of its income each year in the form of dividends. This causes the firm's dividends to fluctuate from year to year. Constant Payout Ratio Low Regular Dividend Plus Extras Residual Dividend Stable, Predictable Dividend O
4. Dividendpractices In general, firms' dividend practices fit into the categories listed in the following table (constant payout ratio, low regular dividend plus extras, residual dividend policy, and stable, predictable dividend policies). Identify the category that each practice corresponds to in the table. Practice Globo-Chem Co. sets its dividend rather conservatively, but supplemental dividends are periodically issued when it finds itself with excess funds. St. Mildred's Brewing Co.'s dividends represent the portion of earnings left after it has made all profitable investments. Spentworth Industries Inc.'s investors like the firm's dividend policy because the firm pays the same dividend every year no matter how the firm performs. Extensive Enterprises Inc. pays out a set percentage of its income each year in the form of dividends. This causes the firm's dividends to fluctuate from year to year. Constant Payout Ratio Low Regular Dividend Plus Extras Residual Dividend Stable, Predictable Dividend O
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:4. Dividend practices
In general, firms dividend practices fit into the categories listed in the following table (constant payout ratio, low regular dividend plus extras, residual
dividend policy, and stable, predictable dividend policies). Identify the category that each practice corresponds to in the table.
Practice
Globo-Chem Co. sets its dividend rather conservatively, but
supplemental dividends are periodically issued when it finds itself
with excess funds.
St. Mildred's Brewing Co.'s dividends represent the portion of
earnings left after it has made all profitable investments.
Spentworth Industries Inc.'s investors like the firm's dividend
policy because the firm pays the same dividend every year no
matter how the firm performs.
Extensive Enterprises Inc. pays out a set percentage of its income
each year in the form of dividends. This causes the firm's
dividends to fluctuate from year to year.
Constant
Payout Ratio
Low Regular
Dividend Plus
Extras
Residual
Dividend
Stable,
Predictable
Dividend
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