Portland Plastics Inc has the following data If it follows the residual dividend model, what is its forecasted dividend payout ratio Capital budget $12,500 Debt 40 Net income (NI) $11,500 ...

Computation of the Dividend payout ratio Given information Capital budget 12500 Debt 40 Net ...

Portland Plastics Inc. has the following data. If it follows the residual dividend model, what is its

Question:

Portland Plastics Inc. has the following data. If it follows the residual model, what is its forecasted payout ratio?
Capital budget ......... $12,500
% Debt ......... 40%
Net income (NI) ....... $11,500

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...