Jonah’s Restaurant reports net income of $20,000 during the year 2015. It distributes a dividend of $6,000 to its shareholders. Calculate the retention ratio.

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asked Jun 28, 2018 125k views

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Jonah’s Restaurant reports net income of $20,000 during the year 2015. It distributes a dividend of $6,000 to its shareholders. Calculate the retention ratio.

Mathematics
high-school

Daan Olislagers asked

by Daan Olislagers

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retention ratio = (net income - dividends) / net income

retention ratio = (20,000 - 6000) / 20000 = 14,000/20,000 = 0.7 = 70%

Dwight Rodriques answered Jul 5, 2018

by Dwight Rodriques

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