These are condensed balance sheet and income statement data for Vicente Fernandez Corporation.

Additional information: 1. The market price of Vicente Fernandez's common stock was \($5.00\), \($3.50\), and \($2.30\) for 2000, 2001, and 2002, respectively. 2. You must compute dividends paid. All dividends were paid in cash. 3. On July 1 , 2001 , 4,000 shares of common stock were issued, and on July 1 , 2002, 6,000 shares were issued.

Instructions

(a) Compute the following ratios for 2001 and 2002.
(1) Profit margin. (5) Price-earnings.
(2) Gross profit rate. (6) Payout.
(3) Asset turnover. (7) Debt to total assets.
(4) Earnings per share.

(b) Based on the ratios calculated, discuss briefly the improvement or lack thereof in the financial position and operating results from 2001 to 2002 of Vicente Fernandez Corporation.

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VICENTE FERNANDEZ CORPORATION Balance Sheets December 31 2002 2001 Cash $ 40,000 $ 24,000 2000 $ 20,000 Receivables (net) 120,000 45,000 48,000 Other current assets 80,000 75,000 62,000 Investments Plant and equipment (net) 90,000 70,000 50,000 650,000 400,000 360,000 $980,000 $614,000 $540,000 Current liabilities $ 98,000 Long-term debt 297,000 Common stock, $10 par 400,000 $ 75,000 75,000 340,000 $ 70,000 65,000 300,000 Retained earnings 185,000 124,000 105,000 $980,000 $614,000 $540,000