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    Amount of the dividends

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    How is this problem done in excel?

    XYZ has a capital budget of $60 million, it optimal capital structure is 40% debt and 60% equity. Its EBIT was $98 million for a year. Has $200 million in assets and pays 10%on all of its debt. Tax rate is 35%. If the firm uses a residual policy, what will be the amount of the dividends it pays after financing its capital budget?

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    https://brainmass.com/business/business-management/computing-amount-dividends-60847

    Solution Summary

    This solution explains the steps to compute the amount of the dividends.

    $2.19

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