ook easures of liquidity, solvency, and profitability Questions Instructions 10.

Question

ook easures of liquidity, solvency, and profitability Questions Instructions 10. Times interest earned 11. Asset turnover 12. Return on total assets 13. Return on stockholders' equity 14. Return on common stockholders equity 15. Earnings per share on common stock 16. Price-earnings ratio 17 Dividends per share of common stock$ 18. Dividend yield 12V % 7 · On cornmon stock Total dividends 9 Retained earnings. December 31 100,000.00 100.000.00 00$110,000.00 $4.194.000.00 $3.704 000.00 $110.000.00 Marshall Inc Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2

Explanation / Answer

11. Asset turnover = Net sales / average total assets

= $10850000 / ($9024000 + $8254000)/2

= $10850000 / $8639000

= 1.26 times.

12. Return on total assets = Netincome / average total assets

= $600000 / $8639000

= 6.95%.

13. Return on stockholder's equity = Net income / Average stock holder's equity

= $600000 / ($4454000 + $4944000)/2

= $600000 / $4699000

= 12.77%

14. Return on common stockholders equity = Net income / average common stockholder's equity

= $600000 / $500000

= 120%

15. Earnings per share of commonstock = Netincome - preferred dividend / weighted average common shares

= $600000 - $10000 / 100000 shares

= $5.9.

16. Price earnings ratio = Market price per share / Earnings per share

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