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Planetary Travel Co. has $162,000,000 in stockholders' equity. Common stock is $30,000,000 and the balance is retained earnings. The firm has $320,000,000 in total assets
Planetary Travel Co. has $162,000,000 in stockholders' equity. Common stock is $30,000,000 and the balance is retained earnings. The firm has $320,000,000 in total assets and 4 percent of this value is in cash. Earnings for the year are $20,000,000 and are included in retained earnings. What is the legal limit on current dividends? (Do not round intermediate calculations. Input your answer in dollars, not millions (e.g., $1, 234,000).) Legal limit on current dividends _____________ What is the practical limit based on liquidity? (Do not round intermediate calculations. Input your answer in dollars, not millions (e.g., $1, 234,000).) Practical limit on current dividends _________________ If the company pays out the amount in part b, what is the dividend payout ratio? (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.) Payout ratio _____________ %
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