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SMOLIRA GOLF CORP 2014 and 2015 Balance Sheets Assets Liabilities and Owners\' E

ID: 2719428 • Letter: S

Question

SMOLIRA GOLF CORP 2014 and 2015 Balance Sheets Assets Liabilities and Owners' Equity 2014 2015 2014 2015 Current assets Current liabilities Cash Accounts receivable $ 24,106 13,048 26,342 $ 24,700 15,800 27,700 Accounts payable Notes payable Other $23,784 16,000 12,171 $27,700 11,400 15,900 Total 63,496 $ 68,200 Total $ 51,955 55,000 $ 75,000 $ 90,000 Long-term debt Owners' equity Common stock and paid-in surplus Accumulated retained earnings $ 45,000 222,236 $ 45,000 242,000 Fxeasseqment $363,800 $432 Net plant and equipment 330,695 Total $267,236 $287,000 Total assets $394,191 Total liabilities and owners' equity $394,191 $432,000 SMOLIRA GOLF CORP 2015 Income Statement Sales Cost of goods sold Depreciation S367,234 235,500 38,600 Earnings before interest and taxes Interest paid $ 93,134 14,900 Taxable income Taxes (30%) $ 78,234 23,470 Net income 54,764 Dividends Retained earnings $35,000 19,764 Smolira Golf Corp. has 35,000 shares of common stock outstanding, and the market price for a share of stock at the end of 2015 was $50. What is the price-earnings ratio? (Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.) Price-earnings ratio times What are the dividends per share? (Round your answer to 2 decimal places, e.g., 32.16.) Dividends per share What is the market-to-book ratio at the end of 2015? (Round your answer to 2 decimal places, e.g., 32.16.) Market-to-book ratio times

Explanation / Answer

P/E ratio= price per share/Earning per share

Price per share: $50

Earnings per share:- 54,764/35000= 1.56

P/E- 50/1.56= 32.05 times.

What are dividends per share

=35,000/35,000= $1 per share.

Market to book value: Market value per share/ Book value per share

Market value=$50

Book value per share: 287,000/35000=8.2

M/B ratio = 50/8.2= 6.097 times

PEG ratio:

P/E ratio/annual EPS growth rate

=32.05/8 = 4.01 times