Exercise 243 (Part Level Submission) Manning Company has $1,000,000 in assets and $1,000,000 in stockholders' equity, with 50,000 shares outstanding the entire year. It has a return on assets ratio of 9%. In the past year it had net income of $75,000. On January 1, 2017, it issued $300,000 in debt at 5% and immediately repurchased 25,000 shares for $300,000. Management expected that, had it not issued the debt, it would have again had net income of $75,000. Determine the Company's net income and earnings per share for 2016 and 2017. (Ignore taxes in your computations.) 2017 2016 Net income Earnings per share (Round 2 decimal places, e.g. 1.25.)
Exercise 243 (Part Level Submission) Manning Company has $1,000,000 in assets and $1,000,000 in stockholders' equity, with 50,000 shares outstanding the entire year. It has a return on assets ratio of 9%. In the past year it had net income of $75,000. On January 1, 2017, it issued $300,000 in debt at 5% and immediately repurchased 25,000 shares for $300,000. Management expected that, had it not issued the debt, it would have again had net income of $75,000. Determine the Company's net income and earnings per share for 2016 and 2017. (Ignore taxes in your computations.) 2017 2016 Net income Earnings per share (Round 2 decimal places, e.g. 1.25.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Exercise 243 (Part Level Submission)
Manning Company has $1,000,000 in assets and $1,000,000 in stockholders' equity, with 50,000 shares outstanding the entire year. It has a return on assets ratio of 9%. In
the past year it had net income of $75,000. On January 1, 2017, it issued $300,000 in debt at 5% and immediately repurchased 25,000 shares for $300,000. Management
expected that, had it not issued the debt, it would have again had net income of $75,000.
Determine the Company's net income and earnings per share for 2016 and 2017. (Ignore taxes in your computations.)
2017
2016
Net income
Earnings per share (Round 2 decimal places, e.g. 1.25.)
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