Walter Industries Is a Family Owned Concern

question 52

Multiple Choice

Walter Industries is a family owned concern.It has been using the residual dividend model,but family members who hold a majority of the stock want more cash dividends,even if that means a slower future growth rate.Neither the net income nor the capital structure will change during the coming year as a result of a dividend policy change to the indicated target payout ratio.By how much would the capital budget have to be cut to enable the firm to achieve the new target dividend payout ratio?

• A)−$2,741,538
• B)−$3,046,154
• C)−$3,384,615
• D)−$3,723,077
• E)−$4,095,385

---

Definitions:

Down's Syndrome

A genetic disorder caused by the presence of an extra 21st chromosome, leading to developmental and physical differences.

Cardiovascular Problems

Cardiovascular problems refer to any disease or condition affecting the heart and blood vessels, often related to atherosclerosis or hypertension.

Cognitive Development

The process through which individuals acquire and evolve their thinking abilities, including problem-solving and decision-making, throughout the lifespan.

Alleles

Variations of a gene found at the same locus on a chromosome, which determine divergent traits that can be passed to offspring.