Question

Colgate-Palmolive Company reports the following balances in its retained earnings.

($ millions)	2010	2009
Retained earnings	$14,329	$13,157

During 2010, Colgate-Palmolive reported net income of $2,222 million.

a. Assume that the only changes affecting retained earnings were net income and dividends. What amount of dividends did Colgate-Palmolive pay to its shareholders in 2010?

$______million

b. This dividend amount constituted what percent of its net income? (Round your answer to one decimal place.)

_______%

Answer 1

a)	$    1,050	Million
Working:
					$ in Millions
	Retained Earning-2009				$       13,157
	Add:Net Income				$         2,222
	Less:Ratained Earning-2010				$       14,329
	Dividend paid				$         1,050
b)	47.3%
Working:
	Dividend Percent		=	Dividend Paid /Net Income
			=	$    1,050	/	$    2,222
			=	47.3%