Dentaltech Inc A)372%
B)39

question 54

Multiple Choice

Dentaltech Inc.projects the following data for the coming year.If the firm follows the residual dividend policy and also maintains its target capital structure,what will be its payout ratio? $\begin{array}{lrlr}\text { EBIT } & \$ 2,000,000 & \text { Capital budget } & \$ 850,000 \\\text { Interest rate } & 10 \% & \% \text { Debt } & 40 \% \\\text { Debt outstanding } & \$ 5,000,000 & \% \text { Equity } & 60 \% \\\text { Shares outstanding } & \$ 5,000,000 & \text { Tax rate } & 40 \%\end{array}$

• A)37.2%
• B)39.1%
• C)41.2%
• D)43.3%

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Definitions:

Firefighters

Trained personnel responsible for extinguishing fires, rescuing individuals, and preventing the spread of fire and damage.

Damages

Monetary compensation that a party is ordered to pay to another as restitution for wrong or injury.

Consistency

The characteristic of being coherent, uniform, or performing in a predictable manner over time.

Parallelism

The use of components in a sentence that are grammatically the same; or similar in their construction, sound, meaning, or meter.