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Two online magazine companies reported the following in their financial statements: BusinessWorld Fun and Games 2015 2014 2015 2014 Net income $ 109,000 $ 108,404

Two online magazine companies reported the following in their financial statements:

BusinessWorld

Fun and Games

2015 2014 2015 2014
Net income $ 109,000 $ 108,404 $ 90,420 $ 171,973
Total stockholders' equity 577,186 502,814 437,151 457,049
Earnings per share 3.00 2.99 1.90 3.78
Stock price when annual results reported 53.90 50.54 32.05 59.20

Required:
1-a.

Compute the 2015 ROE for each company. (Round your answers to 1 decimal place.)

1-b.

Which company appears to generate greater returns on stockholders equity in 2015?

BusinessWorld
Fun and Games
Both Companies appear to generate the same return on equity

2-a.

Compute the 2015 P/E ratio for each company. (Round your answers to 1 decimal place.)

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