Frantic Fast Foods had earnings after taxes of $960,000 in 20X1 with 336,000 shares outstanding. On January 1, 20x2, the firm issued 28,000 new shares. Because of the proceeds from these new shares and other operating Improvements, earings after taxes Increased by 24 percent. 0. Compute eamings per share for the year 20X1. (Round your answer to 2 decimal places.) share b. Compute earnings per share for the year 20X2. (Round your answer to 2 decimal places.) Earnings per share Polly Esther Dress Shops Inc. can open a new store that will do an annual sales volume of $720,000. It will turn over its assets 15 times per year. The profit margin on sales will be 15 percent What would net income and return on assets (investment) be for the year? (Input your return on assets answer as a percent rounded to 2 decimal places.) Net income Return on assets Dr. Zhivago Diagnostics Corp's Income statement for 20x1is as follows: Sales Cost of goods sold Gross profit Selling and administrative expense Operating profit Interest expense Income before taxes Taxes (30%) Income after taxes $ 2,440,000 1,460,000 $ 980,00 373,000 3 607,000 53.00 $ 553, 500 166,00 $ 387,450 a. Compute the profit margin for 20X1. (Input the profit margin as a percent rounded to 2 decimal places.) Pama % b. Assume that in 20x2. sales increase by 10 percent and cost of goods sold increases by 20 percent. The firm is able to keep all other expenses the same. Assume a tax rate of 30 percent on income before taxes. What is income after taxes and the profit margin for 20X27 (Input the profit margin as a percent rounded to 2 decimal places.) 20x2 Income after taxes Profit margin Baker Oats had an asset turnover of 15 times per year. a. If the return on total assets investment) was 104 percent, what was Baker's profit margin? (Input your answer as a percent rounded to 1 decimal place.) b. The following year, on the same level of assets, Baker's assets turnover declined to 16 times and its profit margin was 6.5 percent. How did the return on total assets change from that of the previous year? Increased O Decreased No change The Haines Corp. shows the following financial data for 20X1 and 20X2: 3 $ Sales cost of goods sold Gross profit Selling & administrative expense Operating profit Interest expense Income before taxes Taxes (355) Income after taxes 2exi $ 3,480, eee 2,530,000 $ 95e,eee 255, eee 695, eee 44, see $ 650, 2ee 227y570 $ 422,630 120x2 3,140,000 2,260, eee 880, eee 261, eee 619,000 49,7ee 569, 300 199, 255 370, 845 $ $ $ For each year, compute the following ratios and indicate how the change in each ratio will affect profitability in 20x2. (Input you answers as a percent rounded to 2 decimal places.) 20X1 20X2 Profitability a. Cost of goods sold to sales b. Selling and administrative expense to sales C. Interest expense to sales 96
