Pinnacle Plus declared and paid a cash dividend of $9,100 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 $ 235,000 $ 199,000 Cost of Goods Sold 102,000 98,000 Gross Profit 133,000 101,000 Operating Expenses 61,000 53,000 Interest Expense 6,500 6,500 Income before Income Tax Expense 65,500 41,500 Income Tax Expense (30 ) 19,650 12,450 Net Income $ 45,850 $ 29,050 Balance Sheet Cash $ 102,125 $ 13,000 Accounts Receivable, Net 42,000 37,000 Inventory 50,000 63,000 Property and Equipment, Net 120,000 130,000 Total Assets $ 314,125 $ 243,000 Accounts Payable $ 67,000 $ 32,500 Income Tax Payable 1,625 1,750 Note Payable (long term) 65,000 65,000 Total Liabilities 133,625 99,250 Common Stock (par $10) 105,000 105,000 Retained Earnings 75,500 38,750 Total Liabilities and Stockholders Equity $ 314,125 $ 243,000 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 $125,000 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 $135,000 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 $43 After the release of its previous years financial statements, the companys stock price was $40 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 $9,100 in the current year. Its comparative financial statements, prepared at December 31, reported the following

Pinnacle Plus declared and paid a cash dividend of $9,100 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	$	235,000	$	199,000
Cost of Goods Sold		102,000		98,000
Gross Profit		133,000		101,000
Operating Expenses		61,000		53,000
Interest Expense		6,500		6,500
Income before Income Tax Expense		65,500		41,500
Income Tax Expense (30%)		19,650		12,450
Net Income	$	45,850	$	29,050
Balance Sheet
Cash	$	102,125	$	13,000
Accounts Receivable, Net		42,000		37,000
Inventory		50,000		63,000
Property and Equipment, Net		120,000		130,000
Total Assets	$	314,125	$	243,000
Accounts Payable	$	67,000	$	32,500
Income Tax Payable		1,625		1,750
Note Payable (long-term)		65,000		65,000
Total Liabilities		133,625		99,250
Common Stock (par $10)		105,000		105,000
Retained Earnings		75,500		38,750
Total Liabilities and Stockholders Equity	$	314,125	$	243,000

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 $125,000 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 $135,000 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 $43. After the release of its previous years financial statements, the companys stock price was $40 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?