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Exercise 12-11 Matthias Medical manufactures hospital beds and other institutional furniture. The companys comparative balance sheet and income statement for 2012 and 2013 follow. Matthias Medical Comparative Balance Sheet As of December 31 2013 2012 Assets Current assets Cash $344,000 $417,400 Accounts receivable, net 1,066,600 776,500 Inventory 732,000 681,000 Other current assets 305,000 247,050 Total current assets 2,447,600 2,121,950 Property, plant, & equipment, net 8,719,875 8,369,115 Total assets $11,167,475 $10,491,065 Liabilities and Stockholders Equity Current liabilities $3,188,000 $2,846,100 Long-term debt 3,702,700 3,892,600 Total liabilities 6,890,700 6,738,700 Preferred stock, $5 par value 52,400 52,400 Common stock, $0.25 par value 191,000 103,800 Retained earnings 4,033,375 3,596,165 Total stockholders equity 4,276,775 3,752,365 Total liabilities and stockholders equity $11,167,475 $10,491,065 Matthias Medical Comparative Income Statement and Statement of Retained Earnings For the Year 2013 2012 Sales revenue (all on account) $10,210,000 $9,614,000 Cost of goods sold 5,754,000 5,298,700 Gross profit 4,456,000 4,315,300 Operating expenses 2,840,200 2,634,150 Net operating income 1,615,800 1,681,150 Interest expense 319,000 308,700 Net income before taxes 1,296,800 1,372,450 Income taxes (30%) 389,040 411,735 Net income $907,760 $960,715 Dividends paid Preferred dividends 29,550 29,550 Common dividends 441,000 498,000 Total dividends paid 470,550 527,550 Net income retained 437,210 433,165 Retained earnings, beginning of year 3,596,165 3,163,000 Retained earnings, end of year $4,033,375 $3,596,165

Calculate the earnings per share (average of 356,000 shares outstanding for the year) for 2013. (Round answer to 2 decimal places, e.g. 2.55.) Earning per share $ per share LINK TO TEXT

Calculate the price/earnings ratio (market price of $45 at year-end) for 2013. (Round answer to 2 decimal places, e.g. 2.55.) Price/earnings ratio LINK TO TEXT

Calculate the dividend payout ratio (dividends of $1.04 per common share for the year) for 2013. (Round answer to 2 decimal places, e.g. 2.55%.) Dividend payout ratio %

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