Paul Schwartz, president of Schwartz Corporation, believes that it is a good practice to maintain a constant payout of dividends relative to its earnings. Last year net income was \(\$ 500,000\), and the corporation paid \(\$ 200,000\) in dividends. This year, due to some unusual circumstances, the corporation had income of \(\$ 2,000,000\). Paul expects next year's net income to be about \(\$ 600,000\). What was Schwartz Corporation's payout ratio last year? If it is to maintain the same payout ratio, what amount of dividends would it pay this year? Is this necessarily a good idea-that is, what are the pros and cons of maintaining a constant payout ratio in this scenario?