Financial Ratios. Consider the following data from two companies in very different industries. Adobe Systems is a

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Financial Ratios. Consider the following data from two companies in very different industries. Adobe Systems is a software company. Empire District is an electric utility serving the Midwest. (Amounts except earn- ings per share and market price are in thousands.) Earnings Market Price Total Assets Total Liabilities Net Income per Share per Share Adobe Systems Empire District $1,052,000 653,000 $ 378,000 391,000 $191,000 28,300 $ .96 $39 1.29 21 1. Compute the market-to-book ratio and the rate of return on stockholders' equity for both Adobe Systems and Empire District. 2. Explain what might cause the differences in these ratios between the two companies.

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Introduction To Financial Accounting

ISBN: 0131479725

9th Edition

Authors: Charles T Horngren, John A Elliott

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