Residual distribution model

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Reference no: EM131453452

Residual Distribution Model:

Puckett Products is planning for $5 million in capital Expenditures next year. Puckett’s target capital structure consists of 60% debt and 40% equity. If net income next year is $3 million and Puckett follows a residual Distribution policy with all distributions as dividends, what will be its dividend Payout ratio?

Reference no: EM131453452

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