Towing Inc. had earnings of $39 million in the last 12 months and reinvested 77% of...

Question

Question

Towing Inc. had earnings of $39 million in the last 12 months and reinvested 77% of that.

1) How much did the company pay out in dividends (in $ million)?

Answer 1

Answer #1

Hi

Last 12 month earning = $39 million

reinvestment rate = 77%

1)

paid dividend = 12 month earning* (1-reinvestment rate)

= 39*(1-77%)

= 39*23%

= $8.97 million

Thanks

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Answer 2

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