According to the residual theory of dividends, if the firm\'s equity need is les

Question

According to the residual theory of dividends, if the firm's equity need is less than the amount of retained earnings, the firm would Answer borrow to pay the cash dividend. declare a dividend equal to the remaining balance. pay no cash dividends. not need to consider its dividend policy. According to the residual theory of dividends, if the firm's equity need is less than the amount of retained earnings, the firm would borrow to pay the cash dividend. declare a dividend equal to the remaining balance. pay no cash dividends. not need to consider its dividend policy. borrow to pay the cash dividend. declare a dividend equal to the remaining balance. pay no cash dividends. not need to consider its dividend policy.

Explanation / Answer

declare a dividend equal to the remaining balance.

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