Five Measures of Solvency or Profitability The balance sheet for Garcon Inc. at the end of the current fiscal year indicated the following: Bonds payable, 7% $900,000 Preferred $5 stock, $50 par $89,000 Common stock, $12 par $72,624.00 Income before income tax was $189,000, and income taxes were $28,800 for the current year. Cash dividends paid on common stock during the current year totaled $34,073. The common stock was selling for $225 per share at the end of the year. Determine each of the following. Round answers to one decimal place, except for dollar amounts which should be rounded to the nearest whole cent. Use the rounded answers for subsequent requirements, if required. a. Times interest earned ratio 4 x times b. Earnings per share on common stock 25 V c. Price-earnings ratio d. Dividends per share of common stock 5.6 X e. Dividend yield 22 x % %24

Five Measures of Solvency or Profitability The balance sheet for Garcon Inc. at the end of the current fiscal year indicated the following: Bonds payable, 7% $900,000 Preferred $5 stock, $50 par $89,000 Common stock, $12 par $72,624.00 Income before income tax was $189,000, and income taxes were $28,800 for the current year. Cash dividends paid on common stock during the current year totaled $34,073. The common stock was selling for $225 per share at the end of the year. Determine each of the following. Round answers to one decimal place, except for dollar amounts which should be rounded to the nearest whole cent. Use the rounded answers for subsequent requirements, if required. a. Times interest earned ratio 4 x times b. Earnings per share on common stock 25 V c. Price-earnings ratio d. Dividends per share of common stock 5.6 X e. Dividend yield 22 x % %24

Financial Accounting

15th Edition

ISBN:9781337272124

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter17: Financial Statement Analysis

Section: Chapter Questions

Problem 20E: Five measures of solvency or profitability The balance sheet for Garcon Inc. at the end of the...

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Five measures of solvency or profitability The balance sheet for Garcon Inc. at the end of the current fiscal year indicated the following: Income before income tax was 3,000,000, and income taxes were 1,200,000 for the current year. Cash dividends paid on common stock during the current year totaled 1,200,000. The common stock was selling for 32 per share at the end of the year. Determine each of the following: (a) times interest earned ratio, (b) earnings per share on common stock, (c) price-earnings ratio, (d) dividends per share of common stock, and (e) dividend yield. Round ratios and percentages to one decimal place, except for per-share amounts.
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