Ronaldo inc. has a capital budget of 1000000 but it wants, Ask an Expert

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problem: Ronaldo Inc. has a capital budget of $1,000,000, but it wants to maintain a target capital structure of 60 percent debt and 40 percent equity. The company forecasts this year’s net income to be $600,000. If the company follows a residual dividend policy, find out its dividend payout ratio?

[A] 25.00%

[B] 33.33%

[C] 35.00%

[D] 16.67%

[E] 20.00%

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Basic Finance, Finance

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