Question

Required information [The following information applies to the questions displayed below.] You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company's financial statements, including comparing Lydex's performance to its major competitors. The company's financial statements for the last two years are as follows: Lydex Company Comparative Balance Sheet This Year Last Year $ 1,040,000 0 3,020,000 3,680,000 270,000 8,010,000 9,680,000 $ 17,690,000 $ 1,280,000 300,000 2,120,000 2,300,000 210,000 6,210,000 9 , 130,000 $15,340,000 Assets Current assets: Cash Marketable securities Accounts receivable, net Inventory Prepaid expenses Total current assets Plant and equipment, net Total assets Liabilities and Stockholders' Equity Liabilities: Current liabilities Note payable, 10% Total liabilities Stockholders' equity: Common stock, $75 par value Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 4,090,000 3,720,000 7,810,000 $3,140,000 3,120,000 6,260,000 7,500,000 2,380,000 9,880,000 $ 17,690,000 7,500,000 1,580,000 9,080,000 $15, 340,000

Answer 1

Ans:

	This year	Last Year
Earning Per Share	= Net Income/No of Shares	= Net Income/No of Shares
	=1,120,000/(7500,000/75)	=1,152,900/(7500000/75)
	11.20	11.53
Dividend Payout Ratio	= Divined Per share/ Earning Per Share	= Divined Per share/ Earning Per Share
	=3.2/11.20	=5.76/11.53
	28.57%	49.96%
Dividend Yield Ratio	= Dividend Per Share/ Market Value Per Share	= Dividend Per Share/ Market Value Per Share
	=3.2/110	=5.76/78
	=2.91%	=7.38%
Price Earning Ratio	= Market Price Per Share/ Earning Per share	= Market Price Per Share/ Earning Per share
	=110/11.20	=78/11.53
	9.82	6.76
Book Value Per Share	= Total Shareholder's Equity/ No of Shares	= Total Shareholder's Equity/ No of Shares
	=9880,000/(7500,000/75)	=9080,000/(7500,000/75)
	98.8	90.8