Condensed statement of financial position and income statement data for Clarence Limited appear below. CLARENCE LIMITED Statements
Question:
Condensed statement of financial position and income statement data for Clarence Limited appear below.
CLARENCE LIMITED
Statements of Financial Position
December 31
CLARENCE LIMITED
Income Statement
For the Years Ended December 31
Additional information:
1. The market price of Clarence's ordinary shares was £4.00, £5.00, and £7.00 for 2015, 2016, and 2017, respectively.
2. All dividends were paid in cash.
Instructions
(a) Compute the following ratios for 2016 and 2017.
(1) Profit margin.
(2) Asset turnover.
(3) Earnings per share. (Weighted-average ordinary shares in 2017 were 32,000 and in
2016 were 31,000.)
(4) Price-earnings ratio.
(5) Payout ratio.
(6) Debt to assets ratio.
(b) Based on the ratios calculated, discuss briefly the improvement or lack thereof in financial position and operating results from 2016 to 2017 of Clarence Limited?
Step by Step Answer:
Financial Accounting
ISBN: 978-1118978085
IFRS 3rd edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso