STOCKHOLDERS EQUITY

Name of company chosen: Fannie Mae

Refer to the financial statements and notes to the financial statements. The first note, Summary of Significant Accounting Policies, provides information about the companys accounting methods. You will also need to refer to the other notes to the financial statements and to the financial statements themselves in order to answer the following questions.

IMPORTANT: Indicate the page number on which the information was found

THE BASICS

1. How many shares of common stock have been issued? 1308762703

How many shares are outstanding? 2316163407

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If these numbers differ, explain why.

2. Does the company have any preferred stock outstanding? Yes

If so, how many shares?555,374,922 Par value 9

Dividend rate

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Does the company report any stockholders equity accounts other than contributed capital (capital stock), paid-in capital in excess of par (additional paid-in capital) and retained earnings? List these accounts and their amounts (for example, treasury stock, ac- cumulated other comprehensive income)

Accumulated other comprehensive income, Treasury Stock, Acummulated Deficit

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Calculate the following ratios for each of the three years presented in the stockholders equity statement: (You may be able to find the year-end stock price in the financial review or financial highlights section of the annual report. If the year-end price is not available, compute the average of the high and low prices for the fourth quarter. Show your computations. Indicate the page(s) which contain the information used in the computations.

Dividend payout ratio = Total cash dividends paid on common stock

Net income Page

current year last year two years ago

Dividend yield = Dividends paid per share Page

Stock price at year-end

current year last year two years ago

Earnings per share (provided in income statement) Page

current year last year two years ago

Price-earnings ratio = Market price per share of stock

Earnings per share

current year last year two years ago

Return on common stockholders equity = Net income preferred stock dividends Average common stockholders equity

You will find prior years stockholders equity in the Five-Year Summary of Selected Financial Data.

Current year Prior year

Explain what information each of these ratios provides. Use complete sentences. (a)

(b)

(c)

(d)

(e)