Being a prudent investor, Sally Perkins always investigates a company thoroughly before purchasing shares of its stock
Question:
Ms. Perkins would like answers to a number of questions about the trend of events over the last three years in Plunge Enterprises. Her questions are as follows:
a. Is the market price of the companys stock going up or down?
b. Is the earnings per share increasing or decreasing?
c. Is the price-earnings ratio going up or down?
d. Is the company employing financial leverage to the advantage of the common stockholders?
e. Is it becoming easier for the company to pay its bills as they come due?
f. Are customers paying their bills at least as fast now as they did in Year 1?
g. Is the total of the accounts receivable increasing, decreasing, or remaining constant?
h. Is the level of inventory increasing, decreasing, or remaining constant?
Required:
Answer each of Ms. Perkins questions and explain how you arrived at youranswer.
Step by Step Answer:
Managerial Accounting
ISBN: 9780073526706
12th Edition
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer