Planners have determined that sales will increase by 20% next year, and the profit margin will remain
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Question:
Planners have determined that sales will increase by 20% next year, and the profit margin will remain at 10% of sales. Which one of the following statements is correct if the payout ratio remains at 30%
A. Net Income will increase by 10% next year
B. The addition to retained earnings will increase by 20% next year
C. The dividend will increase by 6% next year
D. The addition to retained earnings will equal 6% of the sales increase next year
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