Durng the past year, the company Introduced several new product lines and raised the selling prices on a number of old product lines In order to Improve Its profit margin. The company also hIred a new sales manager, who has expanded sales Into several new terrtorfes. Sales terms are 2ND, nr30. All sales are on account. osste Paul Sablr has asked you to assess his company's profitability and stock market performance. Required: 'I. You decide first to assess the company's stock market performance. For both this year and last year, compute a we earnings pe share. There has been no change In common stock over the last two years. to he dividend yield ratio. The company's stock Is currently selling for $45 per share; last year It sold for $40 per share. c. The dividend payout ratIo. d "he priceearnings ratio. {Assume that the Industry norm for the priceearnings ratio Is 11) e We book value oer share of common stock. 2 ou decide next to assess the company's profitability. Compute the following for both this year and last year: a. we gross margH percentage o. he net profit margin percentage c. The return on to_al assets. [Total assets at the beginning oflast year were $2, 480.000.) d. he return on equity. [Stockholders' equity at the beginning oflast year was $1. 3,07000.) e. Is the company 5 financial leverage positive or negative? Complete this question by entering your answers in the tabs below. Required 1 Required 2 You decide rst 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 $45 per share; last year it sold for $40 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 priceeamings ratio. (Assume that the industry norm for the price-earnings ratio is 11.) [Do not round intermediate calculations. Round your answers to 2 decimal places.) e. The book value per share of common stock. [Round your answers to 2 decimal places.) Show less; a. Earnings per share in. Dividend yield ratio c. Dividend payout ratio :1. Price-earnings ratio 9. Book value per share During the past year, the company introduced several new product lines and raised the selling prices on a number of old product lines In order to improve its profit margin. The company also hired a new sales manager, who has expanded sales into several new territories. Sales terms are 2/10, n/30. All sales are on account. Assume Paul Sabin has asked you to assess his company's profitability and stock market performance. 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 $45 per share; last year it sold for $40 per share. c. The dividend payout ratio. d. The price-earnings ratio. (Assume that the industry norm for the price-earnings ratio Is 11) e. The book value per share of common stock. 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. C. The return on total assets. (Total assets at the beginning of last year were $2,480,000.) d. The return on equity. (Stockholders' equity at the beginning of last year was $1,307,000.) e. Is the company's financial leverage positive or negative? Complete this question by entering your answers in the tabs below. 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.) C. The return on total assets. (Total assets at the beginning of last year were $2,480,000.) (Round your percentage answers to 1 decimal place.) d. The return on equity. (Stockholders' equity at the beginning of last year was $1,307,000.) (Round your percentage answers to 1 decimal place.) e. Is the company's financial leverage positive or negative? Show less A This Year Last Year a. Gross margin percentage % % b. Net profit margin percentage % % c. Return on total assets % %% d. Return on equity of e. Financial LeveragePaul Sabin organized Sabin Electronics 10 years ago to produce and sell several electronic devices on which he had secured patents. Although the company has been fairly profitable, It is now experiencing a severe cash shortage. For this reason, It is requesting a $560,000 long-term loan from Gulfport State Bank, $130,000 of which will be used to bolster the Cash account and $430,000 of which will be used to modernize equipment. The company's financial statements for the two most recent years follow: Sabin Electronics Comparative Balance Sheet This Year Last Year Assets Current assets: Cash $ 94,000 210,00 Marketable securities 24,900 Accounts receivable, net 555, 000 360, 900 Inventory 1, 005, 000 655, 000 Prepaid expenses 26,060 28, 090 Total current assets 1, 680, 006 1, 277, 000 Plant and equipment, net 1, 665, 400 1, 430, 000 Total assets $ 3,345, 400 $ 2, 707,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 830, 000 $ 490,900 Bonds payable, 12% 900, 000 900, 000 Total liabilities 1, 730, 000 1, 390, 000 Stockholders' equity: Common stock, $15 par 750, 000 750, 000 Retained earnings 865, 400 567, 000 Total stockholders' equity 1, 615, 400 1, 317, 000 Total liabilities and stockholders' equity $ 3,345, 400 $ 2,707,000 Sabin Electronics Comparative Income Statement and Reconciliation This Year Last Year Sales $ 5,300, 000 $ 4,530,000 Cost of goods sold 3,935, 000 3, 510, 000 Gross margin 1, 365, 000 1, 020,000 Selling and administrative expenses 665, 006 560, 900 Net operating income 700, 006 460, 000 Interest expense 108, 000 108, 900 Net income before taxes 592, 006 352, 000 Income taxes (30%) 177, 600 105, 600 Net income 414, 406 246, 400 Common dividends 116, 006 95, 000 Net income retained 298, 406 151, 400 Beginning retained earnings 567,00 415, 600 Ending retained earnings $ 865, 400 $ 567,000 During the past year, the company introduced several new product lines and raised the selling prices on a number of old product lines in order to improve its profit margin. The company also hired a new sales manager, who has expanded sales Into several new territories. Sales terms are 2/10, n/30. All sales are on account