Earnings per Share and Price-Earnings Ratio A company reports the following: Net income $460,000 Preferred dividends $40,000 Shares of common stock outstanding 150,000 Market price per share of common stock $40.60 a. Determine the company's earnings per share on common stock. Round your answer to two decimal places. Use the rounded answer of requirement a for subsequent requirement, if required. b. Determine the company's price-earnings ratio. Round your answer to one decimal place

Earnings per Share and Price-Earnings Ratio A company reports the following: Net income $460,000 Preferred dividends $40,000 Shares of common stock outstanding 150,000 Market price per share of common stock $40.60 a. Determine the company's earnings per share on common stock. Round your answer to two decimal places. Use the rounded answer of requirement a for subsequent requirement, if required. b. Determine the company's price-earnings ratio. Round your answer to one decimal place

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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Solomon Company's income statement information follows: Net sales Income before interest and taxes Net income after taxes Interest expense Stockholders' equity, December 31 (Year 1: $197,000) Common stock, December 31 The average number of shares outstanding was 7,700 for Year 3 and 7,000 for Year 2. Required Compute the following ratios for Solomon for Year 3 and Year 2. a. Number of times interest was earned. Note: Round your answer to 2 decimal places. a. Times interest earned b. Earnings per share c. Price-earnings ratio d. Return on average equity e. Net margin Year 3 b. Earnings per share based on the average number of shares outstanding. Note: Round your answer to 2 decimal places. c. Price-earnings ratio (market prices: Year 3, $64 per share; Year 2, $73 per share). Note: Round your answer to 2 decimal places. d. Return on average equity. Note: Round your percentage answer to 2 decimal places (for example, 0.2345 should be entered as 23.45). e. Net margin. Note: Round your…
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Earnings per share and price-earnings ratio A company reports the following: Line Item Description Amount Net income $650,000 Preferred dividends $45,000 Shares of common stock outstanding 110,000 Market price per share of common stock $44 a. Determine the company's earnings per share on common stock. Round your answer to two decimal places.fill in the blank 1 of 2$ b. Determine the company's price-earnings ratio.
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