Kash Kow Inc. pays out all its after-tax earnings to shareholders in the form of dividends. Suppose

Question:

Kash Kow Inc. pays out all its after-tax earnings to shareholders in the form of dividends. Suppose that in 2012 the company earned $1 per share before tax. Corporate income tax was paid at a rate of 25 percent. For a high-income earner living in Ontario, the personal tax on income was 31.34 percent. How much of the original $1 per share would such a shareholder have left after all the taxes were paid?

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...