Question
Campbell Companys income statement information follows: Net sales $ 428,000 $ 264,000 Income before interest and taxes 114,000 84,000 Net income after taxes 55,560 63,000
Campbell Companys income statement information follows:
Net sales | $ | 428,000 | $ | 264,000 | |||
Income before interest and taxes | 114,000 | 84,000 | |||||
Net income after taxes | 55,560 | 63,000 | |||||
Interest expense | 9,250 | 7,650 | |||||
Stockholders equity, December 31 (Year 1: $192,000) | 313,000 | 242,000 | |||||
Common stock, December 31 | 195,000 | 175,000 | |||||
The average number of shares outstanding was 7,800 for Year 3 and 7,000 for Year 2. Required Compute the following ratios for Campbell for Year 3 and Year 2. a. Number of times interest was earned. (Round your answers to 2 decimal places.) b. Earnings per share based on the average number of shares outstanding. (Round your answers to 2 decimal places.) c. Price-earnings ratio (market prices: Year 3, $65 per share; Year 2, $74 per share).(Round your intermediate and final answers to 2 decimal places.) d. Return on average equity. (Round your percentage answers to 2 decimal places. (i.e., 0.2345 should be entered as 23.45).) e. Net margin. (Round your percentage answers to 2 decimal places. (i.e., 0.2345 should be entered as 23.45).)
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