ABC Co follows a residual dividend policy and maintains a constant debt-equity ratio. There are 12,000 shares
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ABC Co follows a residual dividend policy and maintains a constant debt-equity ratio. There are 12,000 shares of stock outstanding at a market price of $15 a share. There are 300 bonds outstanding, which are selling at $1,200. The projected spending on capital projects is $210,000 for next year. Earnings for next year are estimated at $100,000. What is the projected dividend amount per share?
a. $6.67
b. $2.00
c. $2.50
d. $8.33
Related Book For
Investment Analysis and Portfolio Management
ISBN: 978-0538482387
10th Edition
Authors: Frank K. Reilly, Keith C. Brown
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