Dove, Inc., had additions to retained earnings for the year just ended of $635,000. Thefirm paid out $80,000 in cash dividends, and it has ending total equity of $7.30 million.a. If the company currently has 670,000 shares of common stock outstanding, what areearnings per share? Dividends per share? What is book value per share? (Do notround intermediate calculations and round your answers to 2 decimal places, e.g.,32.16.)b. If the stock currently sells for $30.00 per share, what is the market-to-book ratio? Theprice-earnings ratio? (Do not round intermediate calculations and round youranswers to 2 decimal places, e.g., 32.16.)c. If total sales were $10.6 million, what is the price-sales ratio? (Do not roundintermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)a.b.C.Earnings per shareDividends per shareBook value per shareMarket-to-book ratioPrice-earnings ratioPrice-sales ratiotimestimestimes

The following are the relevant formulas: Earning per share=Net incomeNumber of otstanding…

Answered: Dove, Inc., had additions to retained…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter15: Dividend Policy

Section: Chapter Questions

Problem 2P

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Related questions

Question

Dove, Inc., had additions to retained earnings for the year just ended of $635,000. The
firm paid out $80,000 in cash dividends, and it has ending total equity of $7.30 million.
a. If the company currently has 670,000 shares of common stock outstanding, what are
earnings per share? Dividends per share? What is book value per share? (Do not
round intermediate calculations and round your answers to 2 decimal places, e.g.,
32.16.)
b. If the stock currently sells for $30.00 per share, what is the market-to-book ratio? The
price-earnings ratio? (Do not round intermediate calculations and round your
answers to 2 decimal places, e.g., 32.16.)
c. If total sales were $10.6 million, what is the price-sales ratio? (Do not round
intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
a.
b.
C.
Earnings per share
Dividends per share
Book value per share
Market-to-book ratio
Price-earnings ratio
Price-sales ratio
times
times
times

Expert Solution

Step 1

The following are the relevant formulas:

$Earning per share = \frac{Net income}{Number of otstanding shares} Dividend per share = \frac{Dividend paid}{Number of outstanding shares} Book value per share = \frac{Shareholder' s equity - Preferred equity}{Number of outstanding shares} Market - to - book ratio = \frac{Price per share}{Book value per share} Price - earnings ratio = \frac{Price per share}{Earning per share} Price - sales ratio = \frac{market price per share}{sale price per share}$