Question: From the following data, determine for the current year the (a) rate earned on total assets, (b) rate earned on stockholders' equity, (c) rate earned
From the following data, determine for the current year the (a) rate earned on total assets, (b) rate earned on stockholders' equity, (c) rate earned on common stockholders' equity, (d) earnings per share on common stock, (e) price-earnings ratio on common stock, and (f) dividend yield on common stock. Assume that the current market price per share of common stock is $27. (Present key figures used in your computations.)
|
| Current | Preceding |
|
| Year | Year |
| Current assets | $ 735,000 | $ 820,000 |
| Property, plant, and equipment | 1,500,000 | 1,400,000 |
| Current liabilities |
|
|
| (non-interest-bearing) | 155,000 | 140,000 |
| Long-term liabilities, 12% | 400,000 | 400,000 |
| Preferred 10% stock | 250,000 | 250,000 |
| Common stock, $25 par | 1,200,000 | 1,200,000 |
| Retained earnings: |
|
|
| Beginning of year | 230,000 | 160,000 |
| Net income for year | 85,000 | 155,000 |
| Preferred dividends declared | (25,000) | (25,000) |
| Common dividends declared | (60,000) | (60,000) |
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