A company has a net income of $500,000 for the year 2022. The company has 10,000 shares
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Question:
A company has a net income of $500,000 for the year 2022. The company has 10,000 shares outstanding, and it declares a dividend of $2.50 per share. The company also has $1,000,000 in outstanding debt with an interest rate of 5% per year.
Calculate the following financial ratios for the year 2022:
- Earnings per share (EPS)
- Dividend payout ratio
- Debt-to-equity ratio
- Interest coverage ratio
Also, determine whether the company's financial position has improved or deteriorated compared to the previous year, given that the company had a net income of $450,000 and declared a dividend of $2.00 per share in 2021.
Related Book For
Intermediate Accounting IFRS
ISBN: 9781119607519
4th Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
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