Simon Company's year-end balance sheets follow. Current Yr 1 Yr Ago 2 Yrs Ago At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Long-term notes payable secured by mortgages on plant assets Common stock, $10 par value Retained earnings Total liabilities and equity $ 31,100 $ 34,500 $ 36,200 89, 100 65,000 59,100 36,977 82,800 54,500 10,986 9, 252 3,665 421,837 253,448 186,535 $590,000 $445,000 $340,000 $146,910 $ 74,453 $ 43,982 108, 702 102,350 74,389 162,500 162,500 162,500 171,888 105, 697 59,129 $590,000 $445,000 $340,000 The company's income statements for the Current Year and 1 Year Ago, follow. For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense Income tax expense Total costs and expenses Net income Current Yr $ 767,000 $ 467,870 237,770 13,039 9,971 728,650 $ 38, 350 1 Yr Ago $529,550 $ 344,208 133,976 12,180 7,943 498,307 $ 31,243 Earnings per share $ 2.36 $ 1.92 $29.00 Common stock market price, December 31, Current Year Common stock market price, December 31, 1 Year Ago Annual cash dividends per share in Current Year Annual cash dividends per share 1 Year Ago 27.00 0.36 0.18 For both the Current Year and 1 Year Ago, compute the following ratios: 1. Return on common stockholders' equity. 2. Price-earnings ratio on December 31. 2a. Assuming Simon's competitor has a price-earnings ratio of 6, which company has higher market expectations for future growth? 3. Dividend yield. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 2a Required 3 Compute the return on common stockholders' equity for each year. Return On Common Stockholders' Equity Choose Numerator: 1 Choose Denominator: = Return On Common Stockholders' Equity Return on common stockholders' equity Current Year: 1 Year Ago: Required ? Required 2 > Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 2a Required 3 Compute the price-earnings ratio for each year. (Round your answers to 2 decimal places.) Price-Earnings Ratio 1 Choose Denominator: Choose Numerator: = Price-Earnings Ratio Price-earnings ratio II Current Year: 1 Year Ago: 11 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 2a Required 3 Assuming Simon's competitor has a price-earnings ratio of 6, which company has higher market expectations for future growth? Which company has higher market expectations for future growth? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 2a Required 3 Compute the dividend yield for each year. (Round your answers to 2 decimal places.) Dividend Yield Choose Denominator: Choose Numerator: Dividend Yield Dividend yield Current Year: = % 1 Year Ago %
