Examples of Dividend Ratio and Dividend Yield

Example 1: Given the dividends paid by an organization is 50000 and the net income is 100000 then, find the dividend payout ratio.

Solution:

Dividend payout ratio is given by:

Dividend Payout Ratio = Dividends Paid / Net Income

Dividend Payout Ratio = 50000 /100000

Dividend Payout Ratio = 0.5

Example 2: If the annual dividend per share is 100000 and the current share price is 20000 then, find the dividend yield ratio.

Solution:

Dividend yield is given by the formula:

Dividend Yield = Annual Dividend Per Share / Current Share Price

Dividend Yield = 100000 / 20000

Dividend Yield = 5

How to Calculate Dividend

Dividend per share is calculated using a simple method. To calculate DPS, divide the total number of dividends paid by the company by the total number of shares held. The annual dividend is the total dividends given out during the year.

In this article, we will discuss how to calculate dividends along with the basic information of the dividend. We will also discuss the dividend formula and provide some examples of how to calculate dividends. Let’s start our learning on “How to Calculate Dividend.”

Table of Content

  • What is Dividend Ratio?
  • What is Dividend Yield?
  • Formula and Calculation of Dividend Payout Ratio
  • Formula and Calculation of Dividend Yield
  • What is Difference Between the Dividend Payout Ratio and Dividend Yield?

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What is Dividend Ratio?

Dividend ratio is the ratio between the number of dividends paid and the net income of the organization. In other words, the dividend ratio is the total amount of dividends that an organization pays to shareholders relative to its net income....

What is Dividend Yield?

Dividend yield is given by the ratio of the annual dividend per share to the current share price. In other words, dividend yield is the financial ratio which gives information about the dividends paid by the company each year relative to its share price....

Formula and Calculation of Dividend Payout Ratio

The formula of dividend payout ratio is given by:...

Formula and Calculation of Dividend Yield

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What is Difference Between the Dividend Payout Ratio and Dividend Yield?

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Examples of Dividend Ratio and Dividend Yield

Example 1: Given the dividends paid by an organization is 50000 and the net income is 100000 then, find the dividend payout ratio....

FAQs on Dividend Yield

What is the formula for calculating dividends?...