LA Moving Company Has the Following Data, Dollars in Thousands

question 6

Multiple Choice

LA Moving Company has the following data, dollars in thousands. If it follows the residual dividend model, what will its dividend payout ratio be?
Capital budget
$5,000
% Debt
45%
Net income (NI)
$7,000

• A) 60.71%
• B) 63.75%
• C) 70.13%
• D) 77.14%
• E) 84.85%

---

Definitions:

Elasticity

The ability of a material or body to resume its normal shape after being stretched or compressed.

Conduction Cells

Specialized cells that transmit electrical impulses within the heart, facilitating coordinated heartbeats.

Aortic Semilunar Valve

The valve that regulates blood flow from the heart into the aorta, preventing backflow into the ventricle.

Lubb (S1)

The sound made by the closure of the mitral and tricuspid valves at the beginning of systole, commonly referred to as the "first heart sound."