   Chapter 9, Problem 9.21E

Chapter
Section
Textbook Problem

Earnings per share, price-earnings ratio, dividend yieldThe following information was taken from the financial statements, of Monarch Resources? Inc. for December 31 of the current yean The net income was \$1,300,000. and the declared dividends on the common stock were \$460,000 for the current year. The market price of the common stock is \$92 per share. For the common stock, determine (a) the earnings per share, (b) the price-earnings ratio, (c) the dividends per share, and (d) the dividend yield.

To determine

Concept Introduction:

Earnings per share: It means that company's profit on a single share. This is calculated by division of earnings available for equity share from number of equity shares.

Price earnings ratio: It means that an investor is the amount invested into business to earn a single dollar. It calculates that how much an investor is able to pay per dollar of earnings.

Dividend per share: It tells us about the amount of dividend received per share. To calculate dividend per share is equal to the annual dividend/ purchase price.

Dividend Yield: Dividend expressed as a percentage of a current share price.

To Calculate:

Earnings per share, Price earnings ratio, dividend per share and dividend yield.

Explanation
 Particulars Company 1 Net Income (A) 1300000 Common Shares (B) 100000 EPS (A/B)=C 13 Share mark...

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