Dividends on common stock during Year 2 totaled $60 thousand. Dividends on preferred stock totaled $5 thousand. The market price of common stock at the end of Year 2 was $7.04 per share.

1. The gross margin percentage for Year 2 is closest to:
A. 41.5%
B. 70.9%
C. 15.2%
D. 658.8%

2. The earnings per share of common stock for Year 2 is closest to:
A. $0.40
B. $0.73
C. $0.61
D. $0.43

3. The price-earnings ratio for Year 2 is closest to:
A. 9.64
B. 16.37
C. 11.54
D. 17.60

4. The dividend payout ratio for Year 2 is closest to:
A. 81.3%
B. 75.0%
C. 70.6%
D. 1250.0%

5. The dividend yield ratio for Year 2 is closest to:
A. 0.36%
B. 92.31%
C. 4.26%
D. 4.62%

6. The return on total assets for Year 2 is closest to:
A. 7.85%
B. 7.77%
C. 6.51%
D. 6.44%

7. The return on common stockholders' equity for Year 2 is closest to:
A. 11.33%
B. 10.00%
C. 10.67%
D. 9.41%

8. The book value per share at the end of Year 2 is closest to:
A. $6.60
B. $4.30
C. $3.80
D. $0.40

9. The working capital at the end of Year 2 is:
A. $610 thousand
B. $860 thousand
C. $310 thousand
D. $710 thousand

10. The current ratio at the end of Year 2 is closest to:
A. 2.03
B. 0.35
C. 0.75
D. 0.46

Transcribed Image Text:

Statement of Financial Position December 31, Year 2 and Year 1 (in thousands of dollars) Current assets: Cash..... Accounts receivable. Inventory. Prepaid expenses. Total current assets Plant and equipment, net. Total assets...... Current liabilities: Assets Liabilities and Stockholders' Equity *********** Accounts payable.. Accrued liabilities. Bonds payable.... Total liabilities.. Notes payable, short term. Total current liabilities.. ******** Stockholders' equity: Preferred stock, $100 par value, 5%. Common stock, $2 par value.........….......... Additional paid-in capital--common stock....... Retained earnings....... ************************ Total stockholders' equity Total liabilities & stockholders' equity. Year 2 Year 1 $ 180 260 130 40 610 710 $1.320 $ 200 20 80 300 160 460 $150 240 140 40 570 720 $1.290 $ 170 20 80 270 180 450 100 100 400 400 190 190 170 150 860 840 $1.320 $1.290 Statement of Financial Position December 31, Year 2 and Year 1 (in thousands of dollars) Current assets: Cash..... Accounts receivable. Inventory. Prepaid expenses. Total current assets Plant and equipment, net. Total assets...... Current liabilities: Assets Liabilities and Stockholders' Equity *********** Accounts payable.. Accrued liabilities. Bonds payable.... Total liabilities.. Notes payable, short term. Total current liabilities.. ******** Stockholders' equity: Preferred stock, $100 par value, 5%. Common stock, $2 par value.........….......... Additional paid-in capital--common stock....... Retained earnings....... ************************ Total stockholders' equity Total liabilities & stockholders' equity. Year 2 Year 1 $ 180 260 130 40 610 710 $1.320 $ 200 20 80 300 160 460 $150 240 140 40 570 720 $1.290 $ 170 20 80 270 180 450 100 100 400 400 190 190 170 150 860 840 $1.320 $1.290

Answer rating: 100% (QA)

1 The gross margin percentage for Year 2 is closest to Gross margin percentage Gross margin Sales 560 1350 415 2 The earnings per share of common stoc... View the full answer