Directions: Use the information below to answer the following question. 20Y1 2012 2013 Net profit after...

 

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Directions: Use the information below to answer the following question. 20Y1 2012 2013 Net profit after taxes $350 $570 $710 Cash dividends $75 $180 $260 What is the correct conclusion to draw from the trend in the dividend payout ratio? O The dividend payout ratio is growing, so the business will most likely need to borrow less. The dividend payout ratio is shrinking, which means the business will most likely need to borrow less. The dividend payout ratio is growing, which will most likely lead to increased borrowing needs. Directions: Use the information below to answer the following question. 20Y1 2012 2013 Net profit after taxes $350 $570 $710 Cash dividends $75 $180 $260 What is the correct conclusion to draw from the trend in the dividend payout ratio? O The dividend payout ratio is growing, so the business will most likely need to borrow less. The dividend payout ratio is shrinking, which means the business will most likely need to borrow less. The dividend payout ratio is growing, which will most likely lead to increased borrowing needs.

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The detailed answer for the above question is provided below To determine the trend in the dividend payout ratio we need to calculate the ratio for ea... View the full answer