Cullumber Inc. had net income for 2023 of $6,285,000. The company had 2,300,000 of common shares outstanding throughout theyear. During 2023, Cullumber paid dividends on the common shares of $0.10 per share. Average common shareholder equity was$39,100,000, and the market value of the shares on December 31, 2023 was $22 per share.Cullumber Inc. also had 84,000 shares outstanding of cumulative, $5, no-par value preferred shares. The shares were outstanding forthe full year, and dividends had been kept current for the past several years.Calculate the following ratios for Cullumber Inc.: (Round answers to 2 decimal places, e.g. 25.15 or 25.15%. Round earnings pershare to 3 decimal places for intermediate calculations, e.g. 1.253.)(a)Rate of return on common shareholders' equity(b)Payout ratio(c)Price earnings ratio%di%times

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Answered: Cullumber Inc. had net income for 2023…

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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Q. Colson Corp. had $800,000 net income in 2018. On January 1, 2018 there were 200,000 shares of common stock outstanding. On April 1, 20,000 shares were issued and on September 1, Colson bought 30,000 shares of treasury stock. There are 30,000 options to buy common stock at $40 a share outstanding. The market price of the common stock averaged $50 during 2018. The tax rate is 40%. During 2018, there were 40,000 shares of convertible preferred stock outstanding. The preferred is $100 par, pays $3.50 a year dividend, and is convertible into three shares of common stock. Colson issued $2,000,000 of 8% convertible bonds at face value during 2017. Each $1,000 bond is convertible into 30 shares of common stock. Instructions: Compute diluted earnings per share for 2018. Complete the schedule and show all computations. Security Net Income Adjustment Adjusted Net income Shares Adjustment Adjustment Shares EPS
Purple Cab Company had 60,000 shares of common stock outstanding on January 1, 2024. On April 1, 2024, the company issued 30,000 shares of common stock. The company had outstanding fully vested incentive stock options for 6,000 shares exercisable at $11 that had not been exercised by its executives. The average market price of common stock was $13. The company reported net income in the amount of $279,915 for 2024. What is the basic earnings per share (rounded)? Multiple Choice $4.67 $3.11 $292 $3.39
Kawther Inc. has net income of $200,000, average equity/ordinary shares outstanding of 40,000, and preferred dividends for the period of $20,000. What is Kawther’s earnings per share?
Financial Leaming Systems has 3.1 million shares of common stock outstanding and 117,066 shares of preferred stock. (The preferred pays annual cash dividends of $4.65 a share, and the common pays annual cash dividends of 26 cents a share) Last year, the company generated net profit (after taxes) of $7.627.939. The company's balance sheet shows total assets of $80 million, total liabilitios of $30 million, and $5 million in preferred stock. The firm's common stock is currently trading in the market at $46.72 a share. a. Given the preceding information, find the EPS, P/E ratio, and book value per share b. What will happen to the price of the stock if EPS rises to $3.38 and the P/E ratio stays where it is? What will happen if EPS drops to $1.39 and the P/E doesn't change? c. What will happen to the price of the stock if EPS rises to $3.38 and the P/E jumps to 28.8 times eamings? d. What will happen if both EPS and the P/E ratio drop-to $1.39 and 12.1 times earnings, respectively? e.…
On January 1, 2023, Sunland Corporation had 84,600 common shares outstanding. On April 1, the company issued an additional 28,200 shares. On July 1, the company repurchased and cancelled 43,200 common shares. On November 1, the company issued 53,400 new shares. Cash dividends of $56,000 were declared to non-cumulative preferred shareholders. Net income for the year was $856,230. Calculate the weighted average number of shares for 2023 and earnings per share (EPS). (Round earnings per share to 2 decimal places, e.g. 15.75.) Weighted average number of shares Earnings per share 6A 11 /share
For the year 2021, Aquamarine Corporation has earned a net income of P400,000. Compute for the basic earnings per share under each of the following assumptions a. The company has only one class of stock with 100,000 shares outstanding b. The company has shares outstanding as follows: 8% Preference Share Capital P50 par, 20,000 shares outstanding Ordinary Share Capital P10 par, 100,000 shares outstanding i. Preference shares are cumulative ii. Preference shares are non-cumulative, dividends has been declared by the BOD iii. Preference shares are non-cumulative, no dividend has been declared by the BOD c. Same as letter b but with additional information with regards to the issuance of ordinary shares Jan 1 Beginning Balance 60,000 shares May 1 Additional Isuance 20,000 shares Aug 1 Additional Isuance 20,000 shares Nov 1 Additional Isuance 30,000 shares
Ale Corporation had net income of $2,040,000 and paid dividends to common stockholders of $400,000 in 2020. The weighted average number of shares outstanding in 2020 was 600,000 shares. Ale Corporation's common stock is selling for $82 per share on the New York Stock Exchange. Ale Corporation's price-earnings ratio is a. 3.2 times. b. 16.0 times. C. 19 times. d. 12.7 times.
Im, Incorporated had 52,000 shares of common stock outstanding at January 1, 2024. On March 31, 2024, an additional 12,400 shares were sold for cash, Im also had $4,200,000 of 6% convertible bonds outstanding throughout the year. The bonds are convertible into 42,000 shares of common stock. Net income for the year was $353,000. The tax rate is 25%. Required: Compute basic and diluted earnings per share for the year ended December 31, 2024. Note: Round your answers to 2 decimal places. Basic Diluted $ $ 5.76 5.25
Luther Inc., has 4,000 shares of 5%, $50 par value, cumulative preferred stock and 100,000 shares of $1 par value common stock outstanding at December 31, 2018, and December 31, 2017. The board of directors declared and paid an $8,000 dividend in 2017. In 2018, $40,000 of dividends are declared and paid. What are the dividends received by the preferred stockholders in 2018?A. $28,000B. $12,000C. $20,000D. $10,000
Sunland Limited reported the following items in shareholders' equity on December 31, 2024: Share capital: Preferred shares, $5 cumulative dividend, 145,000 shares issued and outstanding. $14,500,000 Share capital: Common shares, 711,000 issued and outstanding. $28,440,000 Retained earnings. $26,830,000
In 2017 Pedroni Corporation reported net income of $1,000,000. It declared and paid preferred stock a dividend of $250,000. During 2017, Pedroni had a weighted average of 190,000 shares outstanding. Compute Pedroni's Earnings Per Share.
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