The income statement for Christensen, Inc., appears below. Additional information:1. The weighted average common shares outstanding in
Question:
The income statement for Christensen, Inc., appears below.
Additional information:1. The weighted average common shares outstanding in 2010 were 30,000 shares.2. The market price of Christensen, Inc. stock was $13 in 2010.3. Cash dividends of $26,000 were paid, $5,000 of which were to preferred stockholders.InstructionsCompute the following ratios for 2010.(a) Earnings per share.(b) Price-earnings.(c) Payout.(d) Times interestearned.
CHRISTENSEN, INC. Income Statement For the Year Ended December 31, 2010 Sales Cost of goods sold Gross profit Expenses (including $16,000 interest and $24,000 income taxes) Net income $400,000 170,000 105,000 $ 65,000
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Accounting Principles
ISBN: 978-0470533475
9th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
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Stocks (also known as equities) are securities that represent ownership in a company. They are issued by companies to raise capital, and when an individual buys stocks, they become a shareholder in that company. Investing in stocks can be a way for individuals to potentially earn a return on their investment through dividends and capital appreciation. However, investing in stocks also carries a level of risk, as the value of the stock can fluctuate based on various factors such as the financial performance of the company and general market conditions. For companies, issuing stocks can be a way to raise funds for growth and expansion. When a company goes public by issuing an initial public offering (IPO), it can raise significant capital by selling ownership stakes to the public. Companies can also issue additional stock offerings to raise additional capital as needed.
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