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Profitability Ratios The following information has been gathered for Malette Manufacturing: Net income $5,000,000 Interest expense 400,000 Average total assets 60,000,000 Preferred dividends 400,000 Common dividends $1,200,000 Average common shares outstanding 800,000 shares Average common stockholders' equity $20,000,000 Market price per common share $40 Assume that the firm has no common stock equivalents. The tax rate is 34%. Required: 1.  Compute the return on assets. Round your answer to three decimal places. fill in the blank 1 2.  Compute the return on common stockholders' equity. Round your answer to two decimal places. fill in the blank 2 3.  Compute the earnings per share. Round your answer to two decimal places. $ fill in the blank 3 per share

Profitability Ratios The following information has been gathered for Malette Manufacturing: Net income $5,000,000 Interest expense 400,000 Average total assets 60,000,000 Preferred dividends 400,000 Common dividends $1,200,000 Average common shares outstanding 800,000 shares Average common stockholders' equity $20,000,000 Market price per common share $40 Assume that the firm has no common stock equivalents. The tax rate is 34%. Required: 1.  Compute the return on assets. Round your answer to three decimal places. fill in the blank 1 2.  Compute the return on common stockholders' equity. Round your answer to two decimal places. fill in the blank 2 3.  Compute the earnings per share. Round your answer to two decimal places. $ fill in the blank 3 per share

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter15: Financial Statement Analysis
Section: Chapter Questions
Problem 58P: The following information has been gathered for Malette Manufacturing: Assume that the firm has no...
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  1. Profitability Ratios

    The following information has been gathered for Malette Manufacturing:

    Net income $5,000,000
    Interest expense 400,000
    Average total assets 60,000,000
    Preferred dividends 400,000
    Common dividends $1,200,000
    Average common shares outstanding 800,000 shares
    Average common stockholders' equity $20,000,000
    Market price per common share $40

    Assume that the firm has no common stock equivalents. The tax rate is 34%.

    Required:

    1.  Compute the return on assets. Round your answer to three decimal places.
    fill in the blank 1

    2.  Compute the return on common stockholders' equity. Round your answer to two decimal places.
    fill in the blank 2

    3.  Compute the earnings per share. Round your answer to two decimal places.
    $ fill in the blank 3 per share

    4.  Compute the price-earnings ratio. Round your answer to two decimal places.
    fill in the blank 4

    5.  Compute the dividend yield. Round your answer to four decimal places.
    fill in the blank 5

    6.  Compute the dividend payout ratio. Round your answer to two decimal places.
    fill in the blank 6

     
  2.  
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