Using the consolidated statement of earnings for RONA Inc. in Exhibit 11-10 and the partial balance sheet in Exhibit 11-9A, calculate the ratios below. The market price of RONA€™s shares on December 27, 2009, was $15.38.
a. Calculate RONA€™s book and market values. Explain why they are different.
b. Calculate the price/earnings ratio.
c. Calculate the return on common shareholders' equity for 2008 and 2009 and comment on your findings. (For the 2008 ratio, you will need to use year-end equity instead of average.)
In Exhibit 11-10
CONSOLIDATED EARNINGS

In Exhibit 11-9A
CONSOLIDATED FINANCIAL STATEMENTS

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2008 Restated-Note 2 Sales Earnings before the following items (Note 0 Interest on long-term debt Interest on bank loans Depreciation and amortization (Notes 1214,ารเ 4,677,359 332,994 20,951 2,586 103,160 126,697 S 4,891.122 364,729 28,106 2,134 100,958 131,198 Earnings before income taxes and non-controlling interest Income taxes INote 7 Earnings before non-controlling interest Non-controlling interest Net earnings and comprehensive income 206,297 62,714 143,583 5,331 $ 138,252 233,531 71,928 161,603 5,152 $ 156,451 Net earnings per share Note 27 Basic Diluted S 1.12 S 1.11 s 1.35 $ 1.34 2008 Restated-Note 2 Shareholders equity Capital stock (Note 20) Retained earnings Contributed surplus s 603,756 1,161,808 13,475 1,779,039 S 426,786 1,028,876 12,563 1468,225 $ 2,478,918 S 2,749,883