Jacobs Corporation earned $2 million after tax. The firm has 1.6 million shares of common stock outstanding.

Question:

Jacobs earned $2 million after tax. The firm has 1.6 million shares of outstanding.
a. Compute the earnings per share of Jacobs.
b. If Jacobs’ policy calls for a 40 percent payout ratio, what are the dividends per share?

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...