s) West, Ine. has a net income of $800,000 for 2018, and there are 200,000 share
ID: 2548717 • Letter: S
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s) West, Ine. has a net income of $800,000 for 2018, and there are 200,000 shares of common stock outstanding. Dividends declared and paid during the year amounted to $160,000 on the preferred stock and $240,000 on the common stock. The earnings per share for a) $4.00. b) $1.20 c) $3.20. d) $2.00. 2018 is Use the following information for questions 36 and 37: Current Assets Quick Assets Current Liabilities Long-term Liabilities $350,000 200,000 175,000 225,000 36) What is the amount of working capital? a) Negative $25,000 b) $125,000 c) $175,000 d) $325,000 37) What is the quick ratio, rounded to one decimal place? a) 3:1 d) 2:1 Use the following information for questions 38 and 39: Average Total Assets (except for long-term investments) Average Total Assets (including long-term investments) Average Total Stockholders' Equity Average Total Common Stockholders' Equity Net income Interest expense $ 900,000 1,000,000 512,500 412,500 75,000 25,000 38) What is the rate earned on total assets for the current year (round percent to one decimal point)? a) 7.5% b) 10.0% c) 11.1% d) 10.5% 39) What is the rate earned on stockholders' equity for the current year (round percent to one decimal point)? a) 7.5% b) 10.0% c) 14.6% d) 19,5%Explanation / Answer
Qq35 Answer is a. $ 4.00 Explanation: Net income: $ 800,000 Number of Shares of common Stock: 200,000 shares Earning per share: Net income / Number of Shares outstanding $ 800,000 /200,000 shares =$4.00 Q36. Answer is c. $175,000 Explanation: Current Assets: $350,000 Current Liabilities: $175,000 Workin capital: Current assets-Current liabilities =350000-175000 = $175,000 Q37. Answer is c. 1.1 : 1 Explanation: Quick ratio: Quick assets / Current liabilities 200,000 /175000 = 1.1 Q38. Answer is a. 7.5% Explanation: Net income :75000 Average total assets: $ 1000,000 Rate on total assets: Net incme / Average total assets *100 = 75000/1000,000 *100 =7.5% Q39. Answer is C. 14.6% Explanation: Net Income: 75000 Average Stockholder's equity: $ 512,500 Rate o Stockholder's equity: Net income/Av. Stockholder's equity*100 = 75000/512500 *100 = 14.64%
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