Wilco Company Reports the Following: Dividend Payout Ratio for 2005

Multiple Choice

Wilco Company reports the following: Dividend payout ratio for 2005 was:
$\begin{array} { l c c } & 2005 & 2004 \\\text { Retained Earnings } & \$ 2,000,000 & \$ 1,300,000 \\\text { Common Stock } & \$ 500,000 & \$ 500,000 \\\text { Paid-in Capital } & \$ 3,000,000 & \$ 3,000,000 \\\text { Net Income for year } & \$ 900,000 & \$ 400,000\end{array}$

A) 27%.
B) 12%.
C) 22.2%.
D) Not determinable