A debt-equity ratio of 10 is considered optimal earnings


Crawford Inc., a litter recycling company, uses a residual dividend policy. A debt-equity ratio of 1.0 is considered optimal. Earnings for the period just ended were $1,400, and a dividend of $420 was declared.

What were total capital outlays?

  • $1,865
  • $1,960
  • $980
  • $1,000
  • $1,400

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Basic Computer Science: A debt-equity ratio of 10 is considered optimal earnings
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