A firm had the following financials last year: Sales Revenue = $3,060 Accounts receivable = $500 Interest expense = $126 Total operating expenses = $600 Accounts payable = $240 Cost of goods sold = $1,800 Dividend on preferred stock = $18 Tax rate = 40% Number of outstanding number of common shares = 1,000 The E.P.S of the firm, rounded to four decimal places is a. $0.5335 b. $0.3204 c. $0.3024
Financial Ratios
A Ratio refers to a figure calculated as a reference to the relationship of two or more numbers and can be expressed as a fraction, proportion, percentage, or the number of times. When the number is determined by taking two accounting numbers derived from the financial statements, it is termed as the accounting ratio.
Return on Equity
The Return on Equity (RoE) is a measure of the profitability of a business concerning the funds by its stockholders/shareholders. ROE is a metric used generally to determine how well the company utilizes its funds provided by the equity shareholders.
A firm had the following financials last year:
Sales Revenue = $3,060
Accounts receivable = $500
Interest expense = $126
Total operating expenses = $600
Accounts payable = $240
Cost of goods sold = $1,800
Dividend on
Tax rate = 40%
Number of outstanding number of common shares = 1,000
The E.P.S of the firm, rounded to four decimal places is
$0.5335
$0.3204
$0.3024
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