Assume the following financial data: Short-term assets.............................................................................. $300,000 Long-term assets.............................................................................. 500,000 Total assets................................................................................. $800,000 Short-term debt................................................................................ $200,000

Question:

Assume the following financial data:

Short-term assets.............................................................................. 

$300,000

Long-term assets.............................................................................. 

500,000

Total assets................................................................................. 

$800,000

Short-term debt................................................................................ 

$200,000

Long-term debt................................................................................ 

168,000

Total liabilities............................................................................ 

368,000

Common stock................................................................................. 

200,000

Retained earnings............................................................................. 

232,000

Total stockholders’ equity.......................................................... 

432,000

Total liabilities and stockholders’ equity......................................... 

$800,000

Total earnings (after-tax).................................................................. 

$ 72,000

Dividends per share......................................................................... 

$ 1.44

Stock price....................................................................................... 

$ 45

Shares outstanding........................................................................... 

24,000

a. Compute the P/E ratio (stock price to earnings per share).

b. Compute the book value per share (note that book value equals stockholders’ equity).

c. Compute the ratio of stock price to book value per share.

d. Compute the dividend yield.

e. Compute the payout ratio.

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Fundamentals of Investment Management

ISBN: 978-0078034626

10th edition

Authors: Geoffrey Hirt, Stanley Block

Question Posted: