What is the dividend payout ratio based on the provided LTM data where net income was $80m and dividends were $16m?

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Multiple Choice

What is the dividend payout ratio based on the provided LTM data where net income was $80m and dividends were $16m?

Explanation:
The dividend payout ratio tells you what share of earnings the company returns to shareholders as dividends. Use the Last Twelve Months figures: payout ratio = dividends / net income. Here, 16 million divided by 80 million equals 0.20, or 20%. So the best answer is 20%. If you check the other options, they would require different dividend amounts (10% would be 8 million, 25% would be 20 million, 30% would be 24 million), which don’t match the given dividends.

The dividend payout ratio tells you what share of earnings the company returns to shareholders as dividends. Use the Last Twelve Months figures: payout ratio = dividends / net income. Here, 16 million divided by 80 million equals 0.20, or 20%. So the best answer is 20%.

If you check the other options, they would require different dividend amounts (10% would be 8 million, 25% would be 20 million, 30% would be 24 million), which don’t match the given dividends.

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