Listed below are selected financial data for three corporations: Honeywell International, Inc. (environmental controls), The Dow Chemical Company (chemicals and plastic products), and Abbott Laboratories (health care products). These data cover five years (Year 5 is the most recent year; net income in thousands):

Required

a. Calculate the dividend payout ratio for each company for each of the five years.

b. Companies may differ in their dividend policy; that is, they may differ in whether they emphasize a constant dividend amount per share, a steady growth in dividend amount per share, a target or constant dividend payout ratio, or some other criterion. Based on the data available, identify what appears to be each of the above firm's dividend policy over the five-year period.

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Year 5 Year 4 Year 3 Year 2 Year 1 Honeywell International, Inc. Net income....... Earnings per common share $278,900 $2.15 $322,200 $246,800 $331,100 $381,900 $2.40 $1.78 $2.35 $2.52 Dividend per common share. $1.00 $0.91 $0.84 $0.77 $0.70 The Dow Chemical Company Net income.... $938,000 $644,000 $276,000 $942,000 $1,384,000 Earnings per common share $3.88 $2.33 $0.99 $3.46 $5.10 Dividend per common share.. $2.60 $2.60 $2.60 $2.60 $2.60 Abbott Laboratories Net income. $1,399,100 $1,239,100 $1,088,700 $965,800 $859,800 Earnings per common share".. $1.69 $1.47 $1.27 $1.11 $0.96 Dividend per common share. $0.68 $0.60 $0.50 $0.42 $0.35