Alabama Industrial Manufacturers (AIM) Follows the Constant Payout Ratio Dividend

Alabama Industrial Manufacturers (AIM) follows the constant payout ratio dividend policy by paying out 70 percent of earnings each year. This year AIM expects the dividend payment to be 5 percent higher than last year's payment, which was $280,000. What is the amount of net income that AIM expects to generate this year?

A) $294,000
B) $980,000
C) $420,000
D) $686,000
E) $400,000