2.5 million capital bud- CL SIS (VISU Careu le 10 1) Assume that IWT has...
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2.5 million capital bud- CL SIS (VISU Careu le 10 1) Assume that IWT has completed its IPO and has a $112.5 million get planned for the coming year. You have determined that its pre structure (80% equity and 20% debt) is optimal, and its net income at $140 million. Use the residual distribution approach to determine total dollar distribution. Assume for now that the distribution is in a dividend. Suppose IWT has 100 million shares of stock outstandin the forecasted dividend payout ratio? What is the forecasted divide What would happen to the payout ratio and DPS if net income were to decrease to $90 million? To increase to $160 million? In general terms, how would a change in investment opportunities affect the payout ratio under the residual distribution policy? income is forecasted determine IWT'S ibution is in the form of stock outstanding. What is ecasted dividend per share? net income were forecasted
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