Baird Companys income statement information follows: Year 3 Year 2 ...

60.1K

Verified Solution

Question

Accounting

Baird Companys income statement information follows:

Year 3 Year 2

Net sales $ 421,000 $ 265,000

Income before interest and taxes 120,000 76,000

Net income after taxes 55,640 63,600

Interest expense 9,250 7,650

Stockholders equity, December 31 (Year 1: $193,000) 308,000 245,000

Common stock, December 31 195,000 172,500

The average number of shares outstanding was 7,800 for Year 3 and 6,900 for Year 2.

	Year 3	Year 2
Net sales	$ 421,000	$ 265,000
Income before interest and taxes	120,000	76,000
Net income after taxes	55,640	63,600
Interest expense	9,250	7,650
Stockholders equity, December 31 (Year 1: $193,000)	308,000	245,000
Common stock, December 31	195,000	172,500

Required

Compute the following ratios for Baird for Year 3 and Year 2.

a.Number of times interest was earned.

Note: Round your answer to 2 decimal places.

b.Earnings per share based on the average number of shares outstanding.

Note: Round your answer to 2 decimal places.

c.Price-earnings ratio (market prices: Year 3, $65 per share; Year 2, $77 per share).

Note: Round your answer to 2 decimal places.

d.Return on average equity.

Note: Round your percentage answer to 2 decimal places (for example, 0.2345 should be entered as 23.45).

e. Net margin.

Note: Round your percentage answer to 2 decimal places (for example, 0.2345 should be entered as 23.45).

The average number of shares outstanding was 7,800 for Year 3 and 6,900 for Year 2. Required Compute the following ratios for Baird for Year 3 and Year 2. a. Number of times interest was earned. Note: Round your answer to 2 decimal places. b. Earnings per share based on the average number of shares outstanding. Note: Round your answer to 2 decimal places. c. Price-earnings ratio (market prices: Year 3, \$65 per share; Year 2, \$77 per share). Note: Round your answer to 2 decimal places. d. Return on average equity. Note: Round your percentage answer to 2 decimal places (for example, 0.2345 should be entered as 23.45 e. Net margin. Note: Round your percentage answer to 2 decimal places (for example, 0.2345 should be entered as 23.45

Answer & Explanation Solved by verified expert

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member

Baird Companys income statement information follows: Year 3 Year 2 ...

60.1K

Verified Solution

Question

Accounting

Required

Answer & Explanation Solved by verified expert

Get Answers to Unlimited Questions

Membership Benefits:

Other questions asked by students