Final answer:
Investors seeking information on dividends should consult the Statement of Cash Flows and Notes to Financial Statements in a company's financial report; dividends and capital gains are both forms of investor returns.
Step-by-step explanation:
Investors who are interested in the amount of net income distributed as dividends should look at the Statement of Cash Flows and the Notes to Financial Statements within a company's financial statements. The Statement of Cash Flows includes a section that shows cash used for financing activities, where dividend payments are typically listed. The Notes to Financial Statements may provide additional details about dividend distribution policies and amounts. When a firm issues stock, it is recognizing investors' expectations for a rate of return, which can come in the form of dividends or capital gains. Stable companies, like Coca-Cola, tend to offer dividends, which provide investors with a direct return on their investment in addition to potential capital gains due to stock value increase.
The trends in dividends and capital gains can significantly impact the total return for an investor, as evidenced by the historical shifts in these two forms of returns over the decades.Investors can find the amount of net income distributed as dividends in the financial statements under the section called 'Statement of Retained Earnings'. This statement shows how a company's retained earnings have changed during a specific period, which includes the amount of net income that was retained and the amount that was distributed as dividends to shareholders.