Earnings per Share, Price-Earnings Ratio, Dividend Yield The following informati

Question

Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements of Finn Resources Inc. for December 31 of the current fiscal year: Common stock, $50 par value (no change during the year) $12,000,000 Preferred $10 stock, $100 par (no change during the year) 3,000,000 The net income was $780,000 and the declared dividends on the common stock were $115,200 for the current year. The market price of the common stock is $16 per share. For the common stock, determine (a) the earnings per share, (b) the price-earnings ratio, (c) the dividends per share, and (d) the dividend yield.

If required, round your answers to two decimal places.

a. Earnings per Share $ _____

b. Price-Earnings Ratio ______

c. Dividends per Share $ ______

d. Dividend Yield ______%

Explanation / Answer

a. Earnings per Share $ 3.25

The net income after preference dividend - 780,000

No. of common stock share - 12000000/50=240000

c. Dividends per Share $ 0.48

d. Dividend Yield 3%

a. Earnings per Share $ 3.25

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