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Dividend yield/P-E ratio

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The stock of Pills Berry Company is selling at $60 per share. The firm pays a dividend of $1.80 per share.

a. What is the annual dividend yield?
b. If the firm has a payout rate of 50 percent, what is the firm's P/E ratio?

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Solution Preview

a. What is the annual dividend yield?

Dividend Yield = Annual Dividend/Price = 1.80/60 = 3.00%

b. If the ...

Solution Summary

This solution explains how to calculate the dividend yield and the P/E ratio for the given accounting problems.