Calculating the dividend payout ratio, Finance Basics

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Calculating the dividend payout ratio

Ronaldo Inc. has a capital budget of $1,000,000, but it wants to maintain a target capital structure of 60% debt and 40% equity. The company forecasts this year's net income to be $600,000. If the company follows a residual dividend policy, what will be its dividend payout ratio?

16.67%

20.00%

25.00%

33.33%

35.00%

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Finance Basics: Calculating the dividend payout ratio

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Finance Basics: Calculating the dividend payout ratio

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Recent Questions Asked Finance Basics

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Finance Basics: Calculating the dividend payout ratio

Reference No:- TGS053217

Recent Questions Asked Finance Basics

Q : Why growth rates-developed nations lower than poorer nations

Q : Acceptable substitute for a qualified or adverse opinion

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Q : Explain pricing scheme that would offer the higher profits

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