Question: The income statement for Sutherland Inc appears below SUTHERLAND INC

The income statement for Sutherland, Inc., appears below.
SUTHERLAND, INC.
Income Statement
For the Year Ended December 31, 2014
Net sales .......................... $400,000
Cost of goods sold ...................... 230,000
Gross profit ........................ 170,000
Expenses (including $16,000 interest and $24,000 income taxes) ... 105,000
Net income ......................... $ 65,000

Additional information:
1. The weighted-average common shares outstanding in 2014 were 30,000 shares.
2. The market price of Sutherland, Inc. stock was $13 in 2014.
3. Cash dividends of $26,000 were paid, $5,000 of which were to preferred stockholders.

Instructions
Compute the following ratios for 2014.
(a) Earnings per share.
(b) Price-earnings ratio.
(c) Payout ratio.
(d) Times interest earned.




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  • CreatedJanuary 30, 2014
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