Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Evaluate the common stock of Pittsford Incorporated as an investment. Utilize the four ratios that help determine whether a business is generating enough net income

image text in transcribed

Evaluate the common stock of Pittsford Incorporated as an investment. Utilize the four ratios that help determine whether a business is generating enough net income to reward the stockholders for the use of their money; use this information to determine whether the attractiveness of the stock increased or decreased during the past year. Round all ratios to two decimal places. (Click the icon to view the financial information.) Select the four ratios used to evaluate common stock as an investment, select the corresponding formulas, and then calculate each ratio for 2018 and 2017. (Abbreviations used: DPS = Dividends per share, EPS = Earnings per share, P/E = Pricelearnings, ROA = Return on assets, ROE = Return on equity, ROS = Return on sales. Enter ratios as percentages rounded to two decimal places, X.XX%. Round all dollar amounts to two decimal places, X.XX.) Ratio EPS 2018 1.25 2017 1.07 Dividend payout Formula Net income / Average number of common shares outstanding Dividends / Net income Net income / Average stockholders' equity Dividends / Average number of common shares outstanding .30 ROE DPS | 23.36 13.20 % % .01 15.29 11.03 % % Data Table ......... $ Net income............... Total dividends........ Common stockholders' equity at year-end. ..., 2018 107,000 $ 25,000 820,000 90.000 23.000 2017 85,000 $ 13,000 800,000 80,000 2016 83,000 10,500 765,000 78,000 LUI LIVIUGIUO......................................... Uly Lycal l . . . . . . . . . . . . . . . . . . . . Number of shares of common stock outstanding at year-end

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Essentials Of Marketing

Authors: David Brown, Alex Thompson

1st Edition

0367773422, 9780367773427

More Books

Students also viewed these Accounting questions

Question

How are projects relevant to interdisplinary studies

Answered: 1 week ago

Question

1 What is meant by systematic training?

Answered: 1 week ago