$($b$)$

The following are three independent situations and a ratio that may be affected. For each situation, compute the affected ratio $(1)$ as of December $31,2022,$ and $(2)$ as of December $31,2023,$ after giving effect to the situation. $($Round return on common stockholders' equity and price earnings ratio to $1$ decimal place, e$.$g$.1\mathrm{.}8$ or $1\mathrm{.}8\%.$ Round debt to assets ratio and $\%$ change to $0$ decimal places, e$.$g$.25\%.$ If $\%$ change is a decrease show the numbers as negative, e$.$g$.-25\%$ or $(25)\%.)$

Situation

$18,000$ shares of common stock were sold at par on July $1,2023.$ Net income for $2023$ was $$54,000,$ and there were no dividends.

All of the notes payable were paid in $2023.$ All other liabilities remained at their December $31,2022,$ levels. Total assets on December $31,2023$ were $$900,000.$

The market price of common stock was $$9$ and $$12$ on December $31,2022$ and $2023,$ respectively. Net income for $2023$ was $$54,000.($Use a simple average calculation for EPS$).$

Ratio

Return on common stockholders' equity

Debt to assets ratio

Price$-$earnings ratio

$2023$

$2022$

$\%$ Change

'ckholders' equity $\%\%\%$

$\%\%$

$$ times $$ times $\%$

eTextbook and Media

Assistance Used