Company follows a residual dividend policy

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Reference no: EM131328663

?Andrews Corporation has a capital budget of $4,000,000. The company's target capital structure is 40% debt and 60% equity. Its forecasted net income is $3,000,000. If the company follows a residual dividend policy what total dividends, if any, will it pay out?

a. $1,400,00

b. $0

c. $1,000,000

d. $600,000

e. none of above

Reference no: EM131328663

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