ACCOUNTING-W/CENGAGENOWV2 ACCESS
26th Edition
ISBN: 9781305716780
Author: WARREN
Publisher: CENGAGE L
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Question
Chapter 13, Problem 13.8BPE
(a)
To determine
Earnings per share:
Earnings per share represent the amount of income earned per share of outstanding common stock in a period. This ratio is used for analyzing the profitability of company’s stockholders’.
The following formula can be used to calculate earnings per share:
The earnings per share of Incorporation BB for the year ended December 31, 2016 and 2015.
(b)
To determine
To identify: Whether the change in the earnings per share of Incorporation BB from 2016 to 2015 indicates a favorable or unfavorable trend.
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Selected financial information for CraneCorporation as of December are presented below.
2014
2013
Current assets
$104,640
$80,080
Current liabilities
43,680
36,400
Stockholders’ equity
124,800
110,240
Total assets
312,000
280,800
Net sales and net income for 2014 were $468,000 and $37,440 respectively. Dividends of $4,160 were declared for common stockholders and $6,240for preferred shareholders in 2014. Preferred stockholders' equity is equal to 10% of total stockholders' equity.Compute the indicated ratios at December 31, 2014, or for the year ended December 31, 2014, as appropriate. (Round answers to 2 decimal places, e.g. 2.12.)
1.
Return on assets
enter percentages rounded to 2 demical places
%
2.
Profit margin
enter percentages rounded to 2 demical places
%
3.
Payout ratio
enter percentages rounded to 2 demical places
%
4.
Debt assets ratio
enter percentages…
Financial Statement data for the years ended December 31st for the Top Corporation follow:2018 2017Net Income $775,000 $966,000Preferred Dividends $35,000 $35,000Average number of 80,000 shares 95,000 sharescommon shares outstandinga. Determine the earnings per share for 2018 and 2017. b. Does the change in the earnings per share from 2017 to 2018 include a favorable or unfavorable trend?
Profitability ratios
The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 2017, 20Y6, and 20Y5:
December 31
20Y7
December 31
20Y6
December 31
20Y5
Total assets
$307,000
$277,000
$247,000
Notes payable (8% interest)
100,000
100,000
100,000
Common stock
40,000
40,000
40,000
Preferred 6% stock, $100 par
(no change during year)
Retained earnings
20,000
109,920
20,000
80,240
20,000
60,000
The 20Y7 net income was $30,880, and the 2016 net income was $21,440. No dividends on common stock were declared between 2015 and 2017. Preferred dividends were declared and paid in full in 2016 and 2017.
a. Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 2016 and 2017. When required, round your answers to one decimal place.
20Y7
20Y6
Return on total assets
Return on stockholders' equity
Return on common stockholders' equity
%
%
%
%
%
%
b. The profitability ratios indicate…
Chapter 13 Solutions
ACCOUNTING-W/CENGAGENOWV2 ACCESS
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Stockholders Equity: How to Calculate?; Author: Accounting University;https://www.youtube.com/watch?v=2jZk1T5GIlw;License: Standard Youtube License