Pinnacle Plus declared and paid a cash dividend of $8,400 in the current year Its comparative financial statements, prepared at December 31, reported the following summarized information Current Year Previous Year Income Statement Sales Revenue $ 200,000 $ 171,000 Cost of Goods Sold 88,000 84,000 Gross Profit 112,000 87,000 Operating Expenses 54,000 47,400 Interest Expense 5,800 5,800 Income before Income Tax Expense 52,200 33,800 Income Tax Expense (30 ) 15,660 10,140 Net Income $ 36,540 $ 23,660 Balance Sheet Cash $ 92,990 $ 20,000 Accounts Receivable, Net 35,000 30,000 Inventory 43,000 56,000 Property and Equipment, Net 113,000 123,000 Total Assets $ 283,990 $ 229,000 Accounts Payable $ 60,000 $ 33,200 Income Tax Payable 1,450 1,400 Note Payable (long term) 58,000 58,000 Total Liabilities 119,450 92,600 Common Stock (par $10) 100,800 100,800 Retained Earnings 63,740 35,600 Total Liabilities and Stockholders Equity $ 283,990 $ 229,000 Required Compute the gross profit percentage in the current and previous years Are the current year results better, or worse, than those for the previous year Compute the net profit margin for the current and previous years Are the current year results better, or worse, than those for the previous year Compute the earnings per share for the current and previous years Are the current year results better, or worse, than those for the previous year Stockholders equity totaled $118,000 at the beginning of the previous year Compute the return on equity (ROE) ratios for the current and previous years Are the current year results better, or worse, than those for the previous year Net property and equipment totaled $128,000 at the beginning of the previous year Compute the fixed asset turnover ratios for the current and previous years Are the current year results better, or worse, than those for the previous year Compute the debt to assets ratios for the current and previous years Is debt providing financing for a larger or smaller proportion of the companys asset growth Compute the times interest earned ratios for the current and previous years Are the current year results better, or worse, than those for the previous year After Pinnacle Plus released its current years financial statements, the companys stock was trading at $36 After the release of its previous years financial statements, the companys stock price was $33 per share Compute the P E ratios for both years Does it appear that investors have become more (or less) optimistic about Pinnacles future success

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Pinnacle Plus declared and paid a cash dividend of $8,400 in the current year. Its comparative financial statements, prepared at December 31, reported the following

Pinnacle Plus declared and paid a cash dividend of $8,400 in the current year. Its comparative financial statements, prepared at December 31, reported the following summarized information:

	Current Year		Previous Year
Income Statement
Sales Revenue	$	200,000	$	171,000
Cost of Goods Sold		88,000		84,000
Gross Profit		112,000		87,000
Operating Expenses		54,000		47,400
Interest Expense		5,800		5,800
Income before Income Tax Expense		52,200		33,800
Income Tax Expense (30%)		15,660		10,140
Net Income	$	36,540	$	23,660
Balance Sheet
Cash	$	92,990	$	20,000
Accounts Receivable, Net		35,000		30,000
Inventory		43,000		56,000
Property and Equipment, Net		113,000		123,000
Total Assets	$	283,990	$	229,000
Accounts Payable	$	60,000	$	33,200
Income Tax Payable		1,450		1,400
Note Payable (long-term)		58,000		58,000
Total Liabilities		119,450		92,600
Common Stock (par $10)		100,800		100,800
Retained Earnings		63,740		35,600
Total Liabilities and Stockholders Equity	$	283,990	$	229,000

Required:

Compute the gross profit percentage in the current and previous years. Are the current year results better, or worse, than those for the previous year?
Compute the net profit margin for the current and previous years. Are the current year results better, or worse, than those for the previous year?
Compute the earnings per share for the current and previous years. Are the current year results better, or worse, than those for the previous year?
Stockholders equity totaled $118,000 at the beginning of the previous year. Compute the return on equity (ROE) ratios for the current and previous years. Are the current year results better, or worse, than those for the previous year?
Net property and equipment totaled $128,000 at the beginning of the previous year. Compute the fixed asset turnover ratios for the current and previous years. Are the current year results better, or worse, than those for the previous year?
Compute the debt-to-assets ratios for the current and previous years. Is debt providing financing for a larger or smaller proportion of the companys asset growth?
Compute the times interest earned ratios for the current and previous years. Are the current year results better, or worse, than those for the previous year?
After Pinnacle Plus released its current years financial statements, the companys stock was trading at $36. After the release of its previous years financial statements, the companys stock price was $33 per share. Compute the P/E ratios for both years. Does it appear that investors have become more (or less) optimistic about Pinnacles future success?