Hans Martin, president of Martin Corporation, believes that it is a good practice for a company to maintain a constant payout of dividends relative to its earnings. Last year, net income was $640,000, and the corporation paid $140,800 in dividends. This year, due to some unusual circumstances, the corporation had income of $1,490,000. Hans expects next year's net income to be about $740,000. (a1) What was Martin's payout ratio last year? If it is to maintain the same payout ratio, what amount of dividends would it pay this year? Payout ratio-last year 22 % Dividends paid this year $ 327800

Hans Martin, president of Martin Corporation, believes that it is a good practice for a company to maintain a constant payout of dividends relative to its earnings. Last year, net income was $640,000, and the corporation paid $140,800 in dividends. This year, due to some unusual circumstances, the corporation had income of $1,490,000. Hans expects next year's net income to be about $740,000. (a1) What was Martin's payout ratio last year? If it is to maintain the same payout ratio, what amount of dividends would it pay this year? Payout ratio-last year 22 % Dividends paid this year $ 327800

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter6: Accounting For Financial Management

Section: Chapter Questions

Problem 10P: The Moore Corporation has operating income (EBIT) of 750,000. The companys depreciation expense is...

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