Getler Inc.'s projected capital budget is $2,000,000, its target capital structure is 40% debt and 60% equity, and its forecasted net income is $1,125,000. If the company follows a residual dividend policy, how much dividends will it pay or, alternatively, how much new stock must it issue?

Select the correct answer.

a. Dividends $466

Stock issued $75,466

b. Dividends $350

Stock issued $75,350

c. Dividends $117

Stock issued $75,117

d. Dividends $233

Stock issued $75,233

e. Dividends $0

Stock issued $75,000