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PA11-5 (Algo) Computing and Interpreting Return on Equity (ROE) and Price/Earnings (P/E) Ratios [LO 115] Two online magazine companies reported the following in their financial
PA11-5 (Algo) Computing and Interpreting Return on Equity (ROE) and Price/Earnings (P/E) Ratios [LO 115] Two online magazine companies reported the following in their financial statements: Betterworth Outdoor Fun 2021 2020 2021 2020 Net income $111,500 $ 108,904 $92,920 $ 172,473 Total stockholders' equity 602,186 527,814 462,151 482,049 Earnings per share 3.50 3.49 2.40 4.28 Stock price when annual results reported 55.15 51.79 33.30 60.45 Required: 1-a. Compute the 2021 ROE for each company. 1-b. Which company appears to generate greater returns on stockholders' equity in 2021 ? 2-a. Compute the 2021P//E ratio for each company. 2-b. Which company do investors appear to value more? Complete this question by entering your answers in the tabs below. Req 1A Re
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