ABC company's financial statements for the two most recent years follow: ABC Company Assets Comparative Balance Sheet This Year Last Year Current assets: Cash Marketable securities Accounts receivable, net Inventory Prepaid expenses Total current assets Plant and equipment, net Total assets Liabilities and Stockholders' Equity Liabilities: Current liabilities Bonds payable, 12% Total liabilities Stockholders' equity: Common stock, $15 par Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 118,000 $ 270,000 0 30,000 633,000 1,065,000 30,000 1,846,000 1,969,200 $ 3,815,200 $ 820,000 850,000 1,670,000 810,000 1,335,200 2,145,200 $ 3,815,200 420,000 715,000 34,000 1,469,000 1,490,000 $ 2,959,000 $ 420,000 850,000 1,270,000 810,000 879,000 1,689,000 $ 2,959,000 ABC Company Comparative Income Statement and Reconciliation Sales Cost of goods sold This Year $ 5,500,000 3,995,000 Last Year $ 4,710,000 3,570,000 1,140,000 Gross margin Selling and administrative expenses Net operating income Interest expense Net income before taxes Income taxes (30%) Net income Common dividends Net income retained Beginning retained earnings Ending retained earnings 1,605,000 677,000 572,000 928,000 568,000 102,000 102,000 826,000 466,000 247,800 139,800 578,200 326,200 122,000 101,000 456,200 225,200 879,000 653,800 $ 1,335,200 $ 879,000 Assess the company's profitability and stock market performance. Hint - The number of common shares outstanding can be calculated by dividing the dollar amount of common stock, reported on the balance sheet, by the par value per share. Required: 1. You decide first to assess the company's stock market performance. For both this year and last year, compute: a. The earnings per share. There has been no change in common stock over the last two years. b. The dividend yield ratio. The company's stock is currently selling for $50 per share; last year it sold for $45 per share. c. The dividend payout ratio. d. The price-earnings ratio. (Assume that the industry norm for the price-earnings ratio is 9) 2. You decide next to assess the company's profitability. Compute the following for both this year and last year: a. The gross margin percentage. b. The net profit margin percentage. Complete this question by entering your answers in the tabs below. Complete this question by entering your answers in the tabs below. Required 1 Required 2 You decide first to assess the company's stock market performance. For both this year and last year, compute: a. The earnings per share. There has been no change in common stock over the last two years. (Round your answers to 2 decimal places.) b. The dividend yield ratio. The company's stock is currently selling for $50 per share; last year it sold for $45 per share. (Do not round intermediate calculations. Round your percentage answers to 1 decimal place.) c. The dividend payout ratio. (Do not round intermediate calculations. Round your percentage answers to 1 decimal place.) d. The price-earnings ratio. (Assume that the industry norm for the price-earnings ratio is 9.) (Do not round intermediate calculations. Round your answers to 2 decimal places.) a. Earnings per share This Year Last Year b. Dividend yield ratio % % c. Dividend payout ratio % % d. Price-earnings ratio < Required 1 Required 2 > Show less Required 1 Required 2 You decide next to assess the company's profitability. Compute the following for both this year and last year: a. The gross margin percentage. (Round your percentage answers to 1 decimal place.) b. The net profit margin percentage. (Round your percentage answers to 1 decimal place.) This Year Last Year a. Gross margin percentage % b. Net profit margin percentage % % % < Required 1 Required 2 > Show less