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Classic Vinyl Limited is a record wholesaler selling new and used vinyl records to record stores and antique shops throughout Canada. The companys comparative financial

Classic Vinyl Limited is a record wholesaler selling new and used vinyl records to record stores and antique shops throughout Canada. The companys comparative financial statements for the fiscal year ending December 31 appear below. The company did not issue any new common or preferred shares during the year. A total of 790,000 common shares were outstanding. The interest rate on the bond payable was 5%, the income tax rate was 30%, and the dividend per common share was $2.20. The market value of the companys common shares at the end of the year was $157. All of the companys sales are on account:

CLASSIC VINYL LIMITED Comparative Balance Sheet (dollars in thousands)
This Year Last Year
Assets
Current assets:
Cash $ 2,540 $ 2,800
Accounts receivable, net 19,900 20,500
Inventory 33,500 26,320
Prepaid expenses 1,390 1,190
Total current assets 57,330 50,810
Property and equipment:
Land 25,600 25,600
Buildings and equipment, net 92,600 95,000
Total property and equipment 118,200 120,600
Total assets $ 175,530 $ 171,410
Liabilities and Shareholders Equity
Current liabilities:
Accounts payable $ 46,500 $ 52,489
Accrued payables 1,990 2,540
Notes payable, short term 960
Total current liabilities 48,490 55,989
Long-term liabilities:
Bonds payable 23,600 23,600
Total liabilities 72,090 79,589
Shareholders equity:
Preferred shares 2,000 2,000
Common shares 15,800 15,800
Total paid-in capital 17,800 17,800
Retained earnings 85,640 74,021
Total shareholders equity 103,440 91,821
Total liabilities and shareholders equity 175,530 $ 171,410

CLASSIC VINYL LIMITED Comparative Income Statement and Reconciliation of Retained Earnings (dollars in thousands)
This Year Last Year
Sales $ 217,000 $ 228,000
Cost of goods sold 136,600 135,500
Gross margin 80,400 92,500
Selling and administrative expenses:
Selling expenses 37,350 35,850
Administrative expenses 24,100 22,900
Total selling and administrative expenses 61,450 58,750
Operating income 18,950 33,750
Interest expense 1,180 1,180
Net income before taxes 17,770 32,570
Income taxes 5,331 9,771
Net income 12,439 22,799
Dividends to preferred shareholders 180 1,180
Net income remaining for common shareholders 12,259 21,619
Dividends to common shareholders 640 1,738
Net income added to retained earnings 11,619 19,881
Retained earnings, beginning of year 74,021 54,140
Retained earnings, end of year $ 85,640 $ 74,021

Required:

Compute the following financial ratios for this year:

1. Gross margin percentage. (Round your percentage answer to 1 decimal place.)

2. Earnings per share. (Round your answer to 2 decimal places.)

3. Priceearnings ratio. (Do not round intermediate calculations and round your final answer to 1 decimal place.)

4. Dividend payout ratio. (Do not round intermediate calculations and round your percentage answer to 1 decimal place.)

5. Dividend yield ratio. (Round your percentage answer to 1 decimal place.)

6. Return on total assets. (Round your percentage answer to 1 decimal place.)

7. Return on common shareholders equity. (Round your percentage answer to 2 decimal place.)

8. Book value per share. (Round your answer to 2 decimal places.)

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