Makers Corp. had additions to retained earnings for the year just ended of $301,

Question

Makers Corp. had additions to retained earnings for the year just ended of $301,000. The firm paid out $179,000 in cash dividends, and it has ending total equity of $4.84 million. The company currently has 150,000 shares of common stock outstanding

What are earnings per share? (Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.)

If the stock currently sells for $72 per share, what is the market-to-book ratio? (Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.)

What is the price-earnings ratio? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16.)

If the company had sales of $4.98 million, what is the price-sales ratio? (Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.)

What are earnings per share? (Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.)

Explanation / Answer

EPS = (Retained earnings + dividends)/number of shares = (301000+179000)/150000 = 3.2

DPS = 179000/150000 = 1.19

Book value per share = ending equity/number of shares = 4840000/150000 = 32.27

Market to book ratio = market price/Book value per share = 72/32.27 = 2.23

P/E = market price/EPS = 72/3.2 = 22.5

P/S = 72/(4980000/150000) = 2.17

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