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Calculate the expected dividend payout amount

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Question - A company follows a strict residual dividend policy. It has a capital budget of $3,000,000 and a target capital structure that consists of 30% debt and 70% equity. Net income is forecast to be $3.5mil. Calculate the expected dividend payout amount.

a. $1,400,000

b. $2,100,000

c. $3,000,000

d. $900,000

e. $2,450,000

Reference no: EM133019161

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