Global inc has its own target capital structure that


Global Inc. has its own target capital structure that consists of debt and equity. The firm anticipates that its capital budget for the next year will be $1,500,000. If it reports net income of $1,200,000 and wants to maintain a 20% payout ratio, what is its target capital structure (%debt/%equity)? The firm follows a residual dividend policy. Show your work.

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Financial Management: Global inc has its own target capital structure that
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