1) A for-profit hospital earns the gross profit of $10 million. Twenty-five percent (25%) of this net profit is retained earnings and another 30% is charged to corporate tax. If there are two 25% preferred shareholders and ten 10% ordinary shareholders, how much will each shareholder earn as dividend?
2) If each preferred shareholder pays the income tax of 33.33% on their dividend income, Compute their net dividend earning?
3) What is the retention ratio?