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Analyze the financial impact on ( Gainesboro Machine Tools Corporation) GMTC of paying. a) No dividend b) 20% of net income as dividend c) 40%
Analyze the financial impact on ( Gainesboro Machine Tools Corporation) GMTC of paying. a) No dividend b) 20% of net income as dividend c) 40% of net income as dividend d) Residual income after needed capital expenditures as dividend In each case assume the desired maximum debt level is 40% of equity. What is the impact of the different dividend levels on the funding needs given this debt limit?
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