Question

Calculator Profitability Ratios Current Year Prior Year Total Assets $ 1,810,236 $ 1,659,152 Total Liabilities $ 669,328 $ 759,244 Total Equity $ 1,140,908 $ 899,908 Shares Shares Preferred Stock 10,850 9,850 Common Stock 45,928 45,928 Market Price-Common Stock $ 42.67 Net Income $ 150,000 Interest Expense $ 20,000 Preferred Dividends $ 9,000 Calculate the following for the Current Year based on the information abo (Round percent to one place past the decimal. Do not enter % symbol. Example: ROA (Return on Total Assets) % ROE (Return on Stockholders' Equity) % Effect of Leverage % All

Answer 1

gafirm. We will find some propskubidy Radios are best tools for measuring the variam capacide and other ratios below. Refera on Assels = Net Income X 100 Average total Assets. Net Income Given = $ 150,000 Average total Assets Total Assets (prior year) + Tolal Arsely (Curent year 1,810,236 + 1,659 152 -$1,7 34,694 2 Return on Assets - Net Income total Asset Average 150000 X 100 1,7 34,694 806 Equity (11 Refern on stockholders Net Income x100 Total Equity 150000 1,44 0908 x 100 13.1 1.7 111 Total Equity Oo6 Assets Total Debt Leverage 669,328 (approntmate) 1140908 Effects The ideal ratio of deverage is 0.5 or less. But the company has slight ligner severage indicates that the which financed be Debt. company is largely

(LV Earnings per there a Net Income Nomber of common Shock (equily shares) $13.27 (appronimale) 1 50000 45928 Police to earnings Market price Pen share Earnings per share 42.67 13. 68 3.27 .. Price to earnings 1306 Cappronimate)