n August 2019 Coral Ltd reported net profits after tax of $600,000 for its financial year 2018-19
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n August 2019 Coral Ltd reported net profits after tax of $600,000 for its financial year 2018-–19 and announced its net profits after tax expectation for the next financial year, 2019–20, to be 25% higher than this year’s figure. The company operates with a dividend payout ratio of 70%, which it plans to continue. It will pay the annual dividend for 2018–19 on 1 October, 2019, and the dividend for 2019–20 on 1 October, 2020.
Dan Brown owns 12% of the ordinary share capital of Coral Ltd. In October, 2020, Dan believes he will need $30,000 for consumption and he also wishes to pay off his home loan of $70,000. If the dividend from Coral Ltd is his sole income, how much can he consume in October 2019? The capital market offers an interest rate of 9% pa.
Related Book For
International Business
ISBN: 9781292274157
8th Edition
Authors: Simon Collinson, Rajneesh Narula, Alan M. Rugman
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