You are given the following information for Smashville, Inc. Cost oI goods sold:

Question

You are given the following information for Smashville, Inc. Cost oI goods sold: Investment income: Net sales: Operating expense: Interest expense: Dividends: Tax rate: $234,000 $ 2,600 $397,000 $ 92,000 $ 7,400 $ 12,000 40% Current liabilities: Cash: Long-term debt: Other assets: Fixed assets: Other liabilities: Investments: Operating assets: $20,000 $21,000 $ 22,000 $ 42,000 $131,000 $ 5,000 $46,000 $47,000 During the year, Smashville, Inc., had 17,000 shares of stock outstanding and depreciation expense of $15,000. Calculate the book value per share, earnings per share, and cash flow per share. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Book value per share Earnings per share Cash flow per share

Explanation / Answer

Earnings Per Share

Cash Flow Per share

Operating Cash Flows=Income after taxes+Depreciation

=30720+15000

=45720

Cash Flow per share=Operating Cash flow/No fo shares outstanding

=45720/17000

=2.66

Hence

Calculation of Book Value Book value is Total Assets-Liabilities Assets Fixed Asset 116000 131000-15000 Investments 46000 Operating Assets 47000 Other Assets 42000 Cash 21000 Total Assets 272000 Less Liabilities Long-term debt 22000 Current liabilities 20000 Other Liabilities 5000 Total Liabilities 47000 Net Assets 225000 Book value per share Book value of assets/No of Shares Outstanding 225000/17000 13.24

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