(Related to Checkpoint 4.3) (Profitability analysis) Last year the P. M. Postem Corporation had sales of $446,000, with a cost of goods sold of $110,000. The firm's operating expenses were $126,000, and its increase in retained earnings was $99,060. There are currently 24,000 shares of common stock outstanding, the firm pays a $1.56 dividend per share, and the firm has no interest-bearing debt. a. Assuming the firm's earnings are taxed at 35 percent, construct the firm's income statement. b. Compute the firm's operating profit margin.
(Related to Checkpoint 4.3) (Profitability analysis) Last year the P. M. Postem Corporation had sales of $446,000, with a cost of goods sold of $110,000. The firm's operating expenses were $126,000, and its increase in retained earnings was $99,060. There are currently 24,000 shares of common stock outstanding, the firm pays a $1.56 dividend per share, and the firm has no interest-bearing debt. a. Assuming the firm's earnings are taxed at 35 percent, construct the firm's income statement. b. Compute the firm's operating profit margin.
Chapter2: Analysis Of Financial Statements
Section: Chapter Questions
Problem 20PROB
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