In our next step in this process I am addressing the payout ratio in the Target corp. financials. I did talked in one of our first conversations about some ratios which included the Payout ratio.
Payout ratio
Payout ratio is the earning paid to the shareholders in percentage. Companies preferred it to be lower then higher since it’s indicating the pay out and if its’ higher this mean they pay out more than they make in net income. For this ratio I will want to use the completeness and accuracy assertions. Basically because to identify the payout ratio we need to have the correct amount of the dividends per share as well as the earning per share.
To test the completeness assertions I would trace all the reports that