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Required: Compute the following for Year 2: Earnings per share of common stock Price-earnings ratio Dividend payout ratio Dividend yield ratio Return on total assets Return on common stockholders' equity Book value per share Working capital Current ratio Acid-test (quick) ratio Accounts receivable turnover Average collection period (age of receivables) Inventory turnover Average sale period (turnover in days) Times interest earned Debt-to-equity ratio

Required: Compute the following for Year 2: Earnings per share of common stock Price-earnings ratio Dividend payout ratio Dividend yield ratio Return on total assets Return on common stockholders' equity Book value per share Working capital Current ratio Acid-test (quick) ratio Accounts receivable turnover Average collection period (age of receivables) Inventory turnover Average sale period (turnover in days) Times interest earned Debt-to-equity ratio

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter12: Fainancial Statement Analysis
Section: Chapter Questions
Problem 53CE: Profitability Ratios The following data came from the financial statements of Israel Company:...
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Required: Compute the following for Year 2:

  1. Earnings per share of common stock
  2. Price-earnings ratio
  3. Dividend payout ratio
  4. Dividend yield ratio
  5. Return on total assets
  6. Return on common stockholders' equity
  7. Book value per share
  8. Working capital
  9. Current ratio
  10. Acid-test (quick) ratio
  11. Accounts receivable turnover
  12. Average collection period (age of receivables)
  13. Inventory turnover
  14. Average sale period (turnover in days)
  15. Times interest earned
  16. Debt-to-equity ratio
The financial statements of ABC Company are as follows: Income Statement (in '000) Year 2 Sales (all on account) 2,300 Cost of goods sold 1,610 Gross margin 690 Operating expenses 270 Net operating income 420 Interest expense 30 Net income before taxes 390 Income taxes 117 Net income 273
Transcribed Image Text:The financial statements of ABC Company are as follows: Income Statement (in '000) Year 2 Sales (all on account) 2,300 Cost of goods sold 1,610 Gross margin 690 Operating expenses 270 Net operating income 420 Interest expense 30 Net income before taxes 390 Income taxes 117 Net income 273
Dividends during Year 2 totaled P153,000, of wnich P10,000 was preferred dividends. The market price of a snare of common stock on December 31, Year 2 was P210. Balance Sheets (in '000) ASSETS Year 2 Year 1 Current Assets Cash 130 120 Receivables 180 180 Inventories 170 180 Other current assts 20 500 20 Total current assets 500 Noncurrent assets Property and equipment, net 2,000 1,930 Total noncurrent assets 2,000 1,930 Total assets 2,500 2,430 LIABILITIES and EQUITY Current liabilities Accounts payable 130 160 Accrued liabilities 30 60 Notes payable, short term 130 130 Total current liabilities 290 350 Noncurrent liabilities Bonds payable Total noncurrent liabilities 310 300 310 300 Total liabilities 600 650 Stockholders' equity Preferred stock, P10 par, 10% 100 100 Common stock 180 180 Additional paid-in capital - common 160 160 Retained earnings 1460 1340 Total equity 1900 1780 Total Liabilities and Equity 2,500 2,430
Transcribed Image Text:Dividends during Year 2 totaled P153,000, of wnich P10,000 was preferred dividends. The market price of a snare of common stock on December 31, Year 2 was P210. Balance Sheets (in '000) ASSETS Year 2 Year 1 Current Assets Cash 130 120 Receivables 180 180 Inventories 170 180 Other current assts 20 500 20 Total current assets 500 Noncurrent assets Property and equipment, net 2,000 1,930 Total noncurrent assets 2,000 1,930 Total assets 2,500 2,430 LIABILITIES and EQUITY Current liabilities Accounts payable 130 160 Accrued liabilities 30 60 Notes payable, short term 130 130 Total current liabilities 290 350 Noncurrent liabilities Bonds payable Total noncurrent liabilities 310 300 310 300 Total liabilities 600 650 Stockholders' equity Preferred stock, P10 par, 10% 100 100 Common stock 180 180 Additional paid-in capital - common 160 160 Retained earnings 1460 1340 Total equity 1900 1780 Total Liabilities and Equity 2,500 2,430
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