Garza & Gray Realty has sales of $68,900, dividends of $1,960, and net income of $4,900. The firm is expecting sales to decrease by 3 percent next year while the net profit margin remains constant. The firm wants to increase the dividend payout ratio by a fixed 2.5 percent. What is the projected increase in retained earnings for next year?

Answer rating: 100% (QA)

First we need to calculate the dividend payout ratio Dividend payout ratio Dividends Net income Div... View the full answer