A bottled gas company has 200,000 common shares authorized, 400,000 common shares issued and 15,000 common shares in treasury stock at the current year-end. It paid $0.96 per share in cash dividends during the year. The year-end market price of the stock is $15. Calculate (1) the total dividends paid and (2) the dividend yield.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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A bottled gas company has 200,000 common shares authorized, 400,000 common shares issued and 15,000 common shares in treasury stock at the current year-end. It paid $0.96 per share in cash dividends during the year. The year-end market price of the stock is $15. Calculate (1) the total dividends paid and (2) the dividend yield.

Expert Solution
Step 1

Total Dividends Paid = (Total Shares issued - Treasury Stock)Dividend Per share

Dividend Yield = Dividend Per Share/Current Market Price

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