Felton Financial Inc, had net earnings last year of $487,000. If the f
Felton Financial Inc, had net earnings last year of $487,000. If the firm has a dividend payout policy of 30%, what was the addition to retained earnings?
A) $340,900
B) $487,000
C) $146,100
D) There is not enough information to answer this question.
ANSWER
A
Explanation: A) NE * (1-DPO) = $487,000 * (1-.30 ) = $340,900.
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