.Five Measures of Solvency or ProfitabilityThe balance sheet for Quigg Inc. at the end of the current fiscal year indicated the following:Bonds payable, 7%$1,300,000Preferred $10 stock, $50 par88,000Common stock, $10 par598,400Income before income tax expense was $373,100, and income taxes were $56,300 for the current year. Cash dividends paid on common stock during thecurrent year totaled $31,715. The common stock was selling for $35 per share at the end of the year.Determine each of the following. Round answers to one decimal place, except for dollar amounts which should be rounded to the nearestwhole cent. Use the rounded answers for subsequent requirements, if required.a. Times interest earned ratiotimesb. Earnings per share on common stockc. Price-earnings ratiod. Dividends per share of common stocke. Dividend yield%

The following formulas used as follows under:-Times interest earned ratio = Income before interest…

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a. Times interest earned ratio b. Earnings per share on common stock c. Price-earnings ratio 000 times

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

.
Five Measures of Solvency or Profitability
The balance sheet for Quigg Inc. at the end of the current fiscal year indicated the following:
Bonds payable, 7%
$1,300,000
Preferred $10 stock, $50 par
88,000
Common stock, $10 par
598,400
Income before income tax expense was $373,100, and income taxes were $56,300 for the current year. Cash dividends paid on common stock during the
current year totaled $31,715. The common stock was selling for $35 per share at the end of the year.
Determine each of the following. Round answers to one decimal place, except for dollar amounts which should be rounded to the nearest
whole cent. Use the rounded answers for subsequent requirements, if required.
a. Times interest earned ratio
times
b. Earnings per share on common stock
c. Price-earnings ratio
d. Dividends per share of common stock
e. Dividend yield
%

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