The income statement for Stoval Company for the year ended December 31, 2008 appears below. Sales.....................................................................$610,000 Cost
Question:
The income statement for Stoval Company for the year ended December 31, 2008 appears below.
Sales.....................................................................$610,000
Cost of goods sold............................................. 380,000
Gross profit.........................................................230,000
Expenses............................................................... 170,000*
Net income............................................................$ 60,000
*Includes $30,000 of interest expense and $18,000 of income tax expense.
Additional information:
1. Common stock outstanding on January 1, 2008 was 40,000 shares. On July 1, 2008, 10,000 more shares were issued.
2.The market price of Stoval's stock was $15 at the end of 2008.
3. Cash dividends of $30,000 were paid, $6,000 of which were paid to preferred stockholders.
Compute the following ratios for 2008:
(a)Earnings per share.
(b)price-earnings.
(c)Times interest earned.
Common StockCommon stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
Step by Step Answer:
Intermediate Accounting
ISBN: 978-0324300987
10th Edition
Authors: Loren A Nikolai, D. Bazley and Jefferson P. Jones