Explain residual distribution policy

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Reference no: EM13215816

Puckett Products is planning for $2.9 million in capital expenditures next year. Puckett's target capital structure consists of 65% debt and 35% equity. If net income next year is $1.3 million and Puckett follows a residual distribution policy with all distributions as dividends, what will be its dividend payout ratio?

Reference no: EM13215816

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