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Managerial Accounting
Information from Snelling Companys financial statements follows. Average number of

Information from Snelling Companys financial statements follows. Average number of shares outstanding was 16,000 for 2011 and

Question:

Information from Snelling Company€™s financial statements follows.

2011 2010 Net sales Income before interest and taxes Net income after taxes Bond interest expense Stockholders' equity,

Average number of shares outstanding was 16,000 for 2011 and 15,000 for 2010.
Required
Compute the following ratios for Snelling Company for 2011 and 2010.
a. Number of times interest was earned.
b. Earnings per share based on the average number of shares outstanding.
c. Price-earnings ratio (market prices: 2011, $60 per share; 2010, $48 per share).
d. Return on equity.
e. Net margin.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...

Transcribed Image Text:

2011 2010 Net sales Income before interest and taxes Net income after taxes Bond interest expense Stockholders' equity, December 31 (2009: $480,000) Common stock, par $24, December 31 $1,440,000 320,000 148,000 36,000 720,000 420,000 $1,000,000 260,000 96,000 24,000 600,000 360,000

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a Times interest earned 2011 320000 36000 889 times 2010 260000 24000 1083 times b 2011 Earning...View the full answer

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Question Posted: Dec 07, 2011 06:51 AM

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