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1. Eli's Tire Repair has a policy of paying a constant 40% of their Net Income out in dividends. He also has bought a new

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1. Eli's Tire Repair has a policy of paying a constant 40% of their Net Income out in dividends. He also has bought a new tire plugging machine that he expects will increase his Net Income by 20%. If his Net Income last year was $850,000, what can he expect to keep this year in Retained Earnings with the new machine in place? a.) $612,000 b.) $408,000 c.) $510,000 d.) $714,000

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