Worthington AG has declared an annual dividend of 1.50 Swiss Francs (SFr) per share. For the year
Question:
Worthington AG has declared an annual dividend of 1.50 Swiss Francs (SFr) per share. For the year just ended, earnings were SFr14 per share.
(a) What is Worthington’s payout ratio?
(b) Suppose Worthington has 12 million shares outstanding. Borrowing for the coming year is planned at SFr25 million. What are planned investment outlays assuming a residual dividend policy? (See Question 11.) What target capital structure is implicit in these calculations?
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ANSWER a The payout ratio is the proportion of earnings that is paid out as dividends It is calculat...View the full answer
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Corporate Finance
ISBN: 9780077173630
3rd Edition
Authors: David Hillier, Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan, Jeffrey F. Jaffe
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