QUALITATIVE ANALYSIS:

1) The following information was available for the year ended December 31, 2019:

Net income ----------------------------- $ 180,000

Average total assets ------------------ 2,000,000

Dividends per share ------------------------- 1.44

Earnings per share -------------------------- 4.00

Market price per share at year-end ------- 72.00

Required:

a) Calculate the price/earnings ratio for 2019.

b) Calculate the dividend payout ratio for 2019.

c) Calculate the dividend yield for 2019.

2) The following information was available for the year ended December 31, 2019:

Earnings before interest and taxes (operating income) -------------- $ 97,500

Interest expense ---------------------------------------------------------- 15,000

Income tax expense ----------------------------------------------------- 22,500

Net income -------------------------------------------------------------- 60,000

Total assets at year-end --------------------------------------------------- 288,000

Total liabilities at year-end ------------------------------------------------ 216,000

Required:

a) Calculate the debt ratio at December 31, 2019.

b) Calculate the debt/equity ratio at December 31, 2019.

c) Calculate the time's interest earned for the year ended December 31, 2019.