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Business, 20.04.2020 22:24 Evey4851

Green Caterpillar Garden Supplies Inc. reported sales of $820,000 at the end of last year; but this year, sales are expected to grow by 10%. Green Caterpillarexpects to maintain its current profit margin of 23% and dividend payout ratio of 15%. The firm's total assets equaled $500,000 and were operated at full capacity. Green Caterpillar's balan sheet shows the following current liabilities: accounts payable of $65,000, notes payable of $45,000, and accrued liabilities of $75,000.

Because of its excess funds, Green Caterpillar Garden Supplies Inc. is thinking about raising its dividend payout ratio to satisfy shareholders. Green Caterpillar could pay out of its earnings to shareholders without needing to raise any external capital.(Hint: What can Green Caterpillar increase its dividend payout ratio to before the AFN becomes positive)

A. 62.0%
B. 78.5%
C. 66.1%
D. 82.69%

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Green Caterpillar Garden Supplies Inc. reported sales of $820,000 at the end of last year; but this...
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