Ronaldo Inc. has a capital budget of $1,000,000, but it wants to maintain a target capital...
Ronaldo Inc. has a capital budget of $1,000,000, but it wants to maintain a target capital structure of 20% debt and 80% equity. The company forecasts this year’s net income to be $1,000,000. If the company follows a residual dividend policy, what will be its dividend payout ratio?
| a. |
30% |
|
| b. |
20% |
|
| c. |
40% |
|
| d. |
50% |
Homework Answers
dividend payout=Net income-(Capital budget*Weight of equity)
=1,000,000-(1,000,000*80%)=$200,000
dividend payout ratio=dividend payout/net income
=200,000/1,000,000
=20%
Add Answer to:
Ronaldo Inc. has a capital budget of $1,000,000, but it wants to
maintain a target capital...
The capital budget of Creative Ventures Inc. is $1,000,000. The company wants to maintain a target...
The capital budget of Creative Ventures Inc. is $1,000,000. The company wants to maintain a target capital structure that is 30% debt and 70% equity. The company forecasts that its net income this year will be $800,000. If the company follows a residual dividend policy, what will be its total dividend payment?
Grandin Inc. is evaluating its dividend policy. It has a capital budget of $625,000, and it...
Grandin Inc. is evaluating its dividend policy. It has a capital budget of $625,000, and it wants to maintain a target capital structure of 60% debt and 40% equity. The company forecasts a net income of $475,000. If it follows the residual dividend policy, what is its forecasted dividend payout ratio?
Broske Industries has a capital budget of $3,000,000, but it wants to maintain a target capital...
Broske Industries has a capital budget of $3,000,000, but it wants to maintain a target capital structure of 40% debt and 60% equity. The company expects to pay a dividend of $900,000. If the company follows a residual dividend policy, what is its forecasted dividend payout ratio? 20.00% 25.00% 30.00% 33.33% 40.00%
Hermes Co. has a capital budget of $1,200,000
Hermes Co. has a capital budget of $1,200,000. The company wants to maintain a target capital structure which is 60 percent debt and 40 percent equity. The company forecasts that its net income this year will be $600,000. If the company follows a residual dividend policy, what will be its payout ratio? 40% 20% 100% 60% 80%
Brock Brothers wants to maintain its capital structure which is 30 percent debt and 70 percent...
Brock Brothers wants to maintain its capital structure which is 30 percent debt and 70 percent equity. The company forecasts that its net income this year will be $1,000,000. The company follows a residual distribution policy and anticipates a dividend payout ratio of 40 percent. What is the size of the company’s capital budget? a) $600,000 b) $857,143 c) $1,000,000 d) $1,428,571 e) $2,000,000
The capital budget forecast for the Santano Company is $725,000. The CFO wants to maintain a...
The capital budget forecast for the Santano Company is $725,000. The CFO wants to maintain a target capital structure of 45% debt and 55% equity, and it also wants to pay dividends of $125,000. If the company follows the residual dividend policy, how much income must it earn, and what will its dividend payout ratio be? Select the correct answer. a. NI = $523,960 Payout = 23.90% b. NI = $524,380 Payout = 23.96% c. NI = $523,540 Payout =...
Sanchez Company has planned capital expenditures that total $2000000. The company wants to maintain a target...
Sanchez Company has planned capital expenditures that total $2000000. The company wants to maintain a target capital structure that is 35% debt and 65% equity. The company forecasts that its net income this year will be $1,800,000. If the company follows a residual dividend policy, what will be its total dividend payment?
Altamonte Telecommunications has a target capital structure that consists of 40% debt and 60% equity. The...
Altamonte Telecommunications has a target capital structure that consists of 40% debt and 60% equity. The company anticipates that its capital budget for the upcoming year will be $1,000,000. If Altamonte reports net income of $2,500,000 and it follows a residual dividend payout policy, what will be its dividend payout ratio? Round your answer to two decimal places. %
Reed Corporation has a capital budget of $2.25 million
Reed Corporation has a capital budget of $2.25 million. The company wants to maintain a target capital structure which is 60% debt and 40% equity. The company forecasts that its net income this year will be $800,000.a. If the firm uses a payout ratio of 25%, what dividend will Reed pay?b. How much will be added to retained earnings?c. If the company wishes to maintain its debt-equity ratio to finance the capital budget, how much debt must the firm issue?d. ...
Altamonte Telecommunications has a target capital structure that consists of 50% debt and 50% equity. The...
Altamonte Telecommunications has a target capital structure that consists of 50% debt and 50% equity. The company anticipates that its capital budget for the upcoming year will be $3,000,000. If Altamonte reports net income of $1,600,000 and it follows a residual dividend payout policy, what will be its dividend payout ratio? Round your answer to two decimal places. %
Broske Industries has a capital budget of $3,000,000, but it wants to maintain a target capital structure of 40% debt and 60% equity. The company expects to pay a dividend of $900,000. If the company follows a residual dividend policy, what is its forecasted dividend payout ratio? 20.00% 25.00% 30.00% 33.33% 40.00%
Most questions answered within 3 hours.
-
Write a program to solve the Josephus problem, with the following
modification:
Sample Input:
./a.out n...
asked 1 hour ago -
At the start of a CD it is spinning at a rate of 525 rpm
(revolutions...
asked 2 hours ago -
4. Without doing any calculations, predict whether the observed
∆T would increase, decrease or remain the...
asked 3 hours ago -
Based on the range, which of the following sets of scores has
the greatest variability? 3,...
asked 4 hours ago -
Ripples in a pond travel at a velocity of 3 m/s with one peak
passing a...
asked 4 hours ago -
A man stands on the roof of a building of height 13.0 mm and
throws a...
asked 4 hours ago -
The extent to which assets are financed by borrowed funds and
other liabilities is indicated by:...
asked 5 hours ago -
Explain in detail
Germany is the fifth largest economy
explain what goods and services Germany specializes...
asked 5 hours ago -
The density of platinum is 21.45 g/mL. If a cube of platinum
with a mass of...
asked 5 hours ago -
Accounts Receivable
Sales
A/R Posting
Extended Sales Invoice
Packing Slip
Compare invoice to packing slip 2...
asked 5 hours ago -
Michaella, age 23, is a full-time law student and is claimed by
her parents as a...
asked 5 hours ago -
Why are polymers not typically casted into products?
asked 6 hours ago