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A manufacturing firm has just released its comparative financial statements for 20X5 and 20X4 to its owners. Balance Sheet Assets Current assets: (000 omitted)
A manufacturing firm has just released its comparative financial statements for 20X5 and 20X4 to its owners. Balance Sheet Assets Current assets: (000 omitted) Dec 31, 20X5 Dec 31, 20x4 Cash Financial assets held for trading Accounts receivable (net) Inventory Total Current Assets $ 5,000 3,000 16,000 $ 4,000 2,000 14,000 30.000 20,000 $ 54,000 $ 40,000 Non-current assets: Long-term Investments PP&E Intangibles $ 11,000 80,000 3,000 $148,000 $ 11,000 70,000 4,000 $125,000 Total Assets Liabilities and Equity Current liabilities: Accounts payable Accrued payables Total Current Liabilities Bonds payable, 10%, due 20X9 Total Liabilities Equity: Common Stock, 24,000 shares, $1 par Additional paid-in capital Retained earnings Total Equity Total Liabilities and Equity Income Statement $ 11,000 1,000 $ 12,000 30,000 $ 42,000 $ 24,000 48,000 34.000 $106,000 $ 7,000 1,000 $ 8,000 30.000 $38,000 $ 24,000 48,000 15,000 $87,000 $148.000 $125,000 (000 omitted) Sales (all on credit) Cost of goods sold Gross profit Selling and administrative expense Operating income Interest expense Earnings before income taxes Income tax expense Net income 20X5 $385,000 250,000 $135,000 65.000 $ 70,000 3.000 $ 67,000 27.000 $ 40,000 20X4 $300,000 220,000 $ 80,000 36,000 $44,000 3.000 $ 41,000 16,000 $25,000 Other facts are as follows: 1. The market value of the firm's common stock at the end of 20X5 was $15.00 per share. At the end of 20X4, the stock price was $8.50 per share. 2. Total cash dividends paid in 2004 were $12,500. 3. All inventory purchases are made on credit. 4. Use 365 days. Required: A Based on the information given above, calculate the following market ratios for 20X4 and 20x5 (show calculations). Note: There is no potential common stock, and thus the company has a simple capital structure so there is only one EPS figure to calculate. The company's Diluted EPS is the same as its Basic EPS. (1) Earnings per share (EPS) (2) Dividends per share (DPS) (3) Price/Earnings ratio (P/E)
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