Five Measures ofSolvencyorProfitability

The balance sheet for Garcon Inc. at the end of the current fiscal year indicated the following:

Bonds payable, 8%$5,000,000Preferred $4 stock, $50 par$2,500,000Common stock, $10 par$5,000,000

Income before income tax was $3,000,000, and income taxes were $1,200,000 for the current year. Cash dividends paid on common stock during the current year totaled $1,200,000. The common stock was selling for $32 per share at the end of the year.

Determine each of the following. Round to one decimal place, except for dollar amounts which should be rounded to the nearest whole cent. Use the rounded answers for subsequent requirements, if required.

a.Times interest earned ratiotimesb.Earnings per shareon common stock$c.Price-earnings ratiod.Dividends per shareof common stock$e.Dividend yield