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Andrews Corporation has a capital budget of $4,000,000. The company's target capital structure is 40% debt and 60% equity. Its forecasted net income is $3,000,000.
Andrews Corporation has a capital budget of $4,000,000. The company's target capital structure is 40% debt and 60% equity. Its forecasted net income is $3,000,000. If the company follows a residual dividend policy what total dividends, if any, will it pay out?
a. $1,400,00
b. $0
c. $1,000,000
d. $600,000
e. none of above
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