Question $2($Show your workings$)$

Ilama Sdn Bhd had total earnings of RM$7,500,000$ last year and expects a decrease to RM$6,500,000$ this year due to the economic recession. The total dividend paid last year was RM$2,430,000.$ Currently, the company has $900,000$ shares of common stock outstanding. The company plans to invest RM$7,000,000$ this year. The company finances its assets with $40$ percent debt and $60$ percent equity capital.

a$.$ If the company follows a pure residual dividend policy, how large dividends will the shareholders receive this year and what is the dividend per share?

$(8$ Marks$)$

b$.$ What will be the dividend per share last year?

$(2$ Marks$)$

c$.$ If the company maintains a constant dividend payout ratio each year, how large dividends will the shareholders receive this year and what is the dividend per share?

$(8$ Marks$)$

d$.$ If the company follows a constant dollar dividend policy, what will be the dividend per share received by the shareholders?

$(2$ Marks$)$

$($Total: $20$ Marks$)$