3.

2 Research Instrument

The instrument used by the researchers to gather relative data as a basis for evaluation was a
qualitative interview and an open-ended questionnaire. An interview was used as the main data-
gathering instrument for this study. This generates an indirect approach to explore and navigate into the
minds of the sample to be able to retrieve data which are relevant to the facts of the subject matter and
the perception of the sample regarding the issues that are raised during the interview process. A
questionnaire was used as a secondary mode of data-gathering. It includes the profile of the company
and the question proper.

3.2.1 Interview

The researchers conducted an interview to gather information in the inventory management

practices of two companies namely, Monde and Gardenia. To conduct the interview, the researchers
sent a letter to the management of the two companies to ask for permission. The representatives of the
company were asked with open-ended questions regarding their inventory management practices.

3.2.2. Questionnaire

A list of questions was prepared by the researchers to obtain relevant information on the area
of emphasis. The respondents were given the assurance on the confidentiality of their answers.

3.3 Statistical Treatment

Conceptual Framework

Several theories were introduced concerning the relationship of dividend policy of the company
to its share market price. There were two opposing sides in this subject, one stating irrelevance of
dividends and the other proving its significance.

Dividend Irrelevance theories were proposed in the past by Modigliani and Miller where under
certain and strict assumptions, dividend policy would be irrelevant. With the limited flexibility on
assumptions, it came under scrutiny as to its unrealistic underlying assumptions wherein slight deviation
from key assumption would invalidate the dividend irrelevance theory.

In light of this development, a contrasting theory was proposed and supported by several
theorists specifically Litner (1962), Gordon (1963), and Walter (1963). These theorists devised their own
theories arguing that periodic dividends would have caused a positive impact on the share price of a
firm, its market value, and its weight average cost of capital.

The current study was related in a way that the researchers were studying the same subject on
the publicly-listed firms in the real estate industry of the Philippines. The researchers wanted to test the
relationship of dividend payment and payout ratio/retention ratio to the share market price of the firm.

The researchers had established the following figure to represent the relationship among the
variable used in the current study: