Modern Building Supply sells various building materials to retail outlets. The company has just approached Linden State Bank requesting a $300,000 loan to strengthen the Cash account and to pay certain pressing short-term obligations. The companys financial statements for the most recent two years follow:

Modern Building Supply Comparative Balance Sheet
	This Year		Last Year
Assets
Current assets:
Cash	$	58,000	$	137,000
Marketable securities		0		17,000
Accounts receivable, net		462,000		297,000
Inventory		933,000		582,000
Prepaid expenses		17,000		24,000
Total current assets		1,470,000		1,057,000
Plant and equipment, net		1,656,900		1,518,130
Total assets	$	3,126,900	$	2,575,130
Liabilities and Stockholders' Equity
Liabilities:
Current liabilities	$	815,000	$	448,000
Bonds payable, 9%		610,000		610,000
Total liabilities		1,425,000		1,058,000
Stockholders' equity:
Preferred stock, $25 par, 8%		280,000		280,000
Common stock, $10 par		501,000		501,000
Retained earnings		920,900		736,130
Total stockholders' equity		1,701,900		1,517,130
Total liabilities and stockholder's equity	$	3,126,900	$	2,575,130

Modern Building Supply Comparative Income Statement and Reconciliation
	This Year		Last Year
Sales	$	5,011,000	$	4,365,000
Cost of goods sold		3,864,000		3,441,000
Gross margin		1,147,000		924,000
Selling and administrative expenses		653,000		541,000
Net operating income		494,000		383,000
Interest expense		54,900		54,900
Net income before taxes		439,100		328,100
Income taxes (30%)		131,730		98,430
Net income		307,370		229,670
Dividends paid:
Preferred dividends		22,400		22,400
Common dividends		100,200		70,140
Total dividends paid		122,600		92,540
Net income retained		184,770		137,130
Retained earnings, beginning of year		736,130		599,000
Retained earnings, end of year	$	920,900	$	736,130

During the past year, the company has expanded the number of lines that it carries in order to stimulate sales and increase profits. It has also moved aggressively to acquire new customers. Sales terms are 2/10, n/30. All sales are on account.

Assume that the following ratios are typical of companies in the building supply industry:

Current ratio	2.5
Acid-test ratio	1.2
Average collection period	18	days
Average sale period	50	days
Debt-to-equity ratio	0.75
Times interest earned ratio	6.0
Return on total assets	10	%
Price-earnings ratio	9

Assume that you have just inherited several hundred shares of Modern Building Supply stock. Not being acquainted with the company, you decide to do some analytical work before making a decision about whether to retain or sell the stock you have inherited.

Required:
1.	You decide first to assess the well-being of the common stockholders. For both this year and last year, compute the following:

a.	The earnings per share.(Round your answers to 2 decimal places.)

	This year	Last year
Earnings per share	$	$

b.	The dividend yield ratio for common stock. The company