1. The comparative financial statements of Caylay Technologies Inc. are as follows. The market price of Caylay Technologies Inc. common stock was $40 on December 31, 2010.

Instructions

a. Determine the following measures for 2010, rounding to one decimal place:

1. Working capital

2. Current ratio

3. Quick ratio

4. Ratio of liabilities to stockholders equity

5. Number of times interest charges earned

6. Rate earned on total assets

7. Rate earned on stockholders equity

8. Rate earned on common stockholders equity

9. Earnings per share on common stock

10. Price-earnings ratio

11. Dividends per share of common stock

12. Dividend payout ratio of common stock

b. What conclusions can be drawn from these analyses?

Caylay Technologies Inc Comparative Retained Earnings Statement For the Years Ended December 3i 2010 and 2009 2010 2009 Retained earnings, January 1 $1,453,600 $1,218,100 307.500 Add net income for year 482,850 Total $1,936,450 $1.525.600 Deduct dividends 24,000 24,000 On preferred stock On common stock 48.000 48.000 Total 72,000 72,000 Retained earnings, December 31 $1,864,450 600