Question
Consider the following income statement and other information: Luther Corporation Consolidated Income Statement Year ended December 31 (in $ millions) 2009 2008 Total sales 610.1
Consider the following income statement and other information:
Luther Corporation Consolidated Income Statement Year ended December 31 (in $ millions) | ||
2009 | 2008 | |
Total sales | 610.1 | 578.3 |
Cost of sales | (500.2) | (481.9) |
Gross profit | 109.9 | 96.4 |
Selling, general, and administrative expenses | (40.5) | (39.0) |
Research and development | (24.6) | (22.8) |
Depreciation and amortization | (3.6) | (3.3) |
Operating income | 41.2 | 31.3 |
Other income | ||
Earnings before interest and taxes (EBIT) | 41.2 | 31.3 |
Interest income (expense) | (25.1) | (15.8) |
Pretax income | 16.1 | 15.5 |
Taxes | (5.5) | (5.3) |
Net income | 10.6 | 10.2 |
Price per share | $16 | $15 |
Shares outstanding (millions) | 10.2 | 8.0 |
Stock options outstanding (millions) | 0.3 | 0.2 |
Stockholders' Equity | 126.6 | 63.6 |
Total Liabilities and Stockholders' Equity | 533.1 | 386.7 |
Luther's return on equity (ROE) for the year ending December 31, 2009 is closest to:
A) 2.0%
B) 6.5%
C) 8.4%
D)12.7%
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