Banerjee Inc

question 32

Multiple Choice

Banerjee Inc. wants to maintain a target capital structure with 30% debt and 70% equity. Its forecasted net income is $550,000, and its board of directors has decreed that no new stock can be issued during the coming year. If the firm follows the residual dividend policy, what is the maximum capital budget that is consistent with maintaining the target capital structure?

• A) $673,652
• B) $709,107
• C) $746,429
• D) $785,714
• E) $825,000

---

Definitions:

Yayoi

A period in Japanese history (around 300 BCE to 300 CE) characterized by the introduction of agriculture, metalworking, and new pottery styles from the Asian continent.

Yayoi Period

A period in Japanese history from about 300 BCE to 300 CE, characterized by the introduction of rice farming, metallurgy, and new pottery techniques.

Korea

A country in East Asia, located on the Korean Peninsula, known for its rich history and cultural heritage.

China

A country in East Asia, the world's most populous nation, with a rich history that includes the development of one of the earliest civilizations.