A Ltd has made a profit of Rs.1, 20,000. Its gearing ratio is 0.4 which is to be maintained. It cost
of capital is: debt 10%, equity 22%, retained earnings 20%. Four projects are under
consideration.
Investment Required Rate of Return on Investment
A Rs.60, 000 19%
B Rs.50, 000 18%
C Rs.80, 000 17%
D Rs.20, 000 16%
What amount should be paid as dividend?
0 answers