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In 2020, your firm expects sales to increase by 12%. Operating costs and depreciation will only increase by 8%, though. In 2019, sales were $2,000,000.
In 2020, your firm expects sales to increase by 12%. Operating costs and depreciation will only increase by 8%, though. In 2019, sales were $2,000,000. Operating costs were $800,000, and depreciation expenses were $200,000. The firm had $800,000 of debt outstanding at a 9% interest rate. The firm does not plan to issue any new debt in 2020. The firm is in the 25% tax bracket. The firm's payout ratio is 15%. How much more will the firm pay in dividends in 2020 compared to 2019?
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