A company's projected capital budget is $1,200,000, its target capital structure is 50% debt and 50% equity, and its forecasted net income is $700,000. If the company follows a residual dividend policy, what total dividends, if any, will it pay out and what is the payout ratio?

		100,000; 14.29%
		300,000; 42.86%
		200,000; 28.57%
		250,000; 35.71%
		150,000; 21.43%