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Simon Company's year-end balance sheets follow. At December 31 Current Year 1 Year Ago 2 Years Ago Assets Cash $ 32,605 $ 39,278 $ 40,506
Simon Company's year-end balance sheets follow.
At December 31 | Current Year | 1 Year Ago | 2 Years Ago |
---|---|---|---|
Assets | |||
Cash | $ 32,605 | $ 39,278 | $ 40,506 |
Accounts receivable, net | 99,320 | 67,376 | 53,473 |
Merchandise inventory | 117,601 | 89,033 | 58,099 |
Prepaid expenses | 11,036 | 9,902 | 4,412 |
Plant assets, net | 303,337 | 280,531 | 248,610 |
Total assets | $ 563,899 | $ 486,120 | $ 405,100 |
Liabilities and Equity | |||
Accounts payable | $ 139,007 | $ 82,976 | $ 54,543 |
Long-term notes payable | 102,833 | 112,926 | 89,527 |
Common stock, $10 par value | 162,500 | 162,500 | 162,500 |
Retained earnings | 159,559 | 127,718 | 98,530 |
Total liabilities and equity | $ 563,899 | $ 486,120 | $ 405,100 |
For both the current year and one year ago, compute the following ratios:
Exercise 13-11 (Algo) Analyzing profitability LO P3
The companys income statements for the Current Year and 1 Year Ago, follow.
For Year Ended December 31 | Current Year | 1 Year Ago | ||
---|---|---|---|---|
Sales | $ 733,069 | $ 578,483 | ||
Cost of goods sold | $ 447,172 | $ 376,014 | ||
Other operating expenses | 227,251 | 146,356 | ||
Interest expense | 12,462 | 13,305 | ||
Income tax expense | 9,530 | 8,677 | ||
Total costs and expenses | 696,415 | 544,352 | ||
Net income | $ 36,654 | $ 34,131 | ||
Earnings per share | $ 2.26 | $ 2.10 |
Additional information about the company follows.
Common stock market price, December 31, Current Year | $ 28.00 |
---|---|
Common stock market price, December 31, 1 Year Ago | 26.00 |
Annual cash dividends per share in Current Year | 0.32 |
Annual cash dividends per share 1 Year Ago | 0.16 |
For both the current year and one year ago, compute the following ratios:
1. Return on equity.
2. Dividend yield.
3a. Price-earnings ratio on December 31.
3b. Assuming Simon's competitor has a price-earnings ratio of 7, which company has higher market expectations for future growth?
For both the current year and one year ago, compute the following ratios: Exercise 13-11 (Algo) Analyzing profitability LO P3 The company's income statements for the Current Year and 1 Year Ago, follow. Additional information about the company follows. For both the current year and one year ago, compute the following ratios: 1. Return on equity. 2. Dividend yield. 3a. Price-earnings ratio on December 31 . 3b. Assuming Simon's competitor has a price-earnings ratio of 7, which company has higher market expectations for future growth? Complete this question by entering your answers in the tabs below. Compute the return on equity for each yearStep by Step Solution
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