Question
Components Manufacturing Corporation has million shares of stock outstanding. CMC has a target capital sttructure with 60% equity and 40% debt. The companay projects net
Components Manufacturing Corporation has million shares of stock outstanding. CMC has a target capital sttructure with 60% equity and 40% debt. The companay projects net income of $5 million and investment projects requiring $6 million in the upcoming year.
a. CMC uses the residual distribution model and pays all distrubtions in the form of dividends. What is the projected DPS?
b. What is the projected payout ratio?
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Personal Finance A Practical Approach
Authors: Jane King, Mary Carey
1st Edition
0199668833, 9780199668830
