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Answer: 38%.
## Calculation Explanation **Step 1: Calculate Adjusted FFO** - FFO = $70,000 - Adjusted FFO = FFO + Non-cash rent - Recurring capital expenditures - Adjusted FFO = $70,000 + $5,000 - $10,000 = $65,000 **Step 2: Calculate Adjusted FFO per share** - Adjusted FFO per share = Adjusted FFO / Weighted average shares - Adjusted FFO per share = $65,000 / 25,000 = $2.60 **Step 3: Calculate Dividend Payout Ratio** - Dividend per share = $1.00 - Payout ratio = Dividend per share / Adjusted FFO per share - Payout ratio = $1.00 / $2.60 = 0.3846 or 38.46% The closest answer is **38%** (Option B).
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38 An analyst gathers the following information about a REIT for the year just ended:
$70,000$5,000$10,000If dividends per share are $1.00 for the year, the dividend payout ratio on adjusted FFO is closest to:
A
29%.
B
38%.
C
45%.
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