How to Calculate Dividends: Formula for Using Balance Sheet

You can find most companies' dividends without having to calculate them, but you'll be a better investor if you understand how to do it yourself.

By Jason Hall – Updated Apr 30, 2025 at 10:26 PM

Key Points

Calculate dividends by subtracting year-end retained earnings from start-year retained earnings, then net income.
Dividend payout ratio (DPR) is found by dividing total dividends by net income to assess dividend sustainability.
For dividends per share, divide total dividends by shares outstanding, checking for accuracy with the latest SEC filings.

Most companies report their dividends on a cash flow statement, in a separate accounting summary in their regular disclosures to investors, or in a stand-alone press release, but that's not always the case. If not, you can calculate dividends using a balance sheet and an income statement. You'll find these in a company's 10-K annual report.

Here is the formula for calculating dividends: Annual net income minus net change in retained earnings = dividends paid.

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Multiple stacks of pennies growing larger each stack. — Image source: Getty Images.

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Here is the DPR formula: Total dividends ÷ net income = dividend payout ratio. — Image source: The Motley Fool.

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Take total dividends divided by net income, and you will get DPR.

This is useful in measuring a company's ability to keep paying or even increasing a dividend. The higher the payout ratio, the harder it may be to maintain it; the lower, the better.

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About the Author

Jason Hall is a contributing Motley Fool stock market analyst with more than a decade of experience writing about dividend stocks and long-term investing. He has been with the company since 2012 and previously spent over 10 years in technical sales in the printing and information services industry. Jason also founded and operated a small food manufacturing business.

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