Victor Rumsfeld Inc

question 27

Multiple Choice

Victor Rumsfeld Inc.'s dividend policy is under review by its board.Its projected capital budget is $2, 000, 000, its target capital structure is 60% debt and 40% equity, and its forecasted net income is $600, 000.If the company follows a residual dividend policy, what total dividends, if any, will it pay out?

• A) $240, 000
• B) $228, 000
• C) $216, 600
• D) $205, 770
• E) $0

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