Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Firm AshleighBartyWinsAustralian Open 2022 has a 30% Dividend payout ratio, in other words it pays out 30% of its Net Income to its shareholders. How

image text in transcribed
Firm AshleighBartyWinsAustralian Open 2022 has a 30% Dividend payout ratio, in other words it pays out 30% of its Net Income to its shareholders. How would a dedine in a this firm's tax rate from 35% to 21% influence the dollar amount of its dividend payment and its retained earnings? Both the dividend payment and the retained earnines dollar amounts, will increase Only retained earnings will decrease but the dividend will remain unchanged in dollar terms Only the dividend will increase but retained earnings will remain unchaped in doitetom There wil be no change to the dollar amount of the dividend payment and of the retained earnings, the will just pay lower taxes Both the dividend payment and the retained earning dollar amounts, would decrease

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Finance questions