Last year, Headline News Corporation paid $600,000 in dividends and retained $360,000 of the earnings it generated.

Question:

Last year, Headline News Corporation paid $600,000 in dividends and retained $360,000 of the earnings it generated. The company follows a constant payout ratio dividend policy. If Headline generates $1.25 million in income this year, how much will be paid in dividends?

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... 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...

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