Week Four Assignment eBook Calculator Print Item Nineteen Measures of Solvency a
ID: 2514554 • Letter: W
Question
Week Four Assignment eBook Calculator Print Item Nineteen Measures of Solvency and Profitability The comparative financial statements of Blige Inc. are as follows. The market price of Blige Inc. common stock was $51 on December 31, 2016. Blige Inc. Comparative Retained Earnings Statement For the Years Ended December 31, 2016 and 2015 2016 2015 Retained earnings, January 1 Add net income for year Total Deduct dividends $875,400 210,000 $1,085,400 $743,800 152,400 $896,200 $7,000 13,800 $20,800 $1,064,600 $7,000 13,800 $20,800 $875,400 On preferred stock On common stock Total Retained earnings, December 31 Blige Inc. Comparative Income Statement For the Years Ended December 31, 2016 and 2015 2016 2015 Sales Sales returns and allowances Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses Income from operations Other income $1,232,530 6,130 $1,226,400 416,100 $810,300 $278,220 237,010 515,230 $295,070 15,530 $310,600 72,000 $238,600 $1,133,900 3,980 $1,129,920 382,810 $747,110 $344,540 202,350 546,890 $200,220 12,780 $213,000 40,000 $173,000 Other expense (interest) Income before income tax Check My Work PreviousExplanation / Answer
10). NO. of times interest charges are earned = Income before Interest and Tax / Interest Expense
= 310600/72000 = 4.3138
12). Ratio of sales to assets = Sales revenue/ Total Assets
= 1226400/2690280 = 0.455 or 45.58%
13).Rate earned on Total Assets = Income before Income and Tax / Total Assets
= 310600/2690280 = 0.1154 or 11.54%
14). Rate earned on stockholder's equity = Net Income/ Average Stockholder's Equity
= Net Income / (1494600+1305400)/2 = Net Income is not available to me which after tax but before dividend.
You can use this formula.
15).Rate earned on Common stockholder's equity = (Net Income - Preferred Dividend)/ Average Common Stockholdr's Equity
= (Net Income - 7000)/(1494600+1305400-20000-200000)/2 (Here preferred stock is reduced).
Use this formula
16). Earning per share of common equity= ( Net Income - Dividend)/Averge common outstanding shares
Use This formula= Average common outstanding shares = 230000/10 = 23000
17) Price Earning Ratio = Share price/ EPS = 51/EPS (Calculate EPS Then put it here).
18). Dividen per share of common stock = Dividend paid/ Average no. of outstanding shares
= 13800/ 23000 = 0.6
19). Dividend Yeild = Dividend Per share/ Price Per share = 0.6 / 51 = 0.11 or 1.176%
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.