Information from Forman Company's financial statements follows:
___________________________________________2018 2017
Net sales..................................................$1,000,000........................ $800,000
Income before interest and taxes.........................180,000.......................... 150,000
Net income after taxes..................................... 128,000.......................... 108,000
Bond interest expense........................................20,000........................... 16,000
Stockholders' equity, December 31 (2016: $240,000). 360,000......................... 300,000
Common stock, par $12, December 31................... 210,000........................ 180,000
Average number of shares outstanding was 16,000 for 2018 and 15,000 for 2017.
Required
Compute the following ratios for Forman Company for 2018 and 2017 and round computations to two decimal points.
a. Number of times interest was earned.
b. Earnings per share based on the average number of shares outstanding.
c. Price-earnings ratio (market prices: 2018, $30 per share; 2017, $24 per share).
d. Return on equity.
e. Net margin.