The Balance Sheet for Seuss Company at the End of the Current

question 5

Essay

The balance sheet for Seuss Company at the end of the current fiscal year indicated the following:?? $\begin{array}{lr}\text { Bonds payable, } 10 \% \text { (20-year term) } & \$ 5,000,000 \\\text { Preferred } 10 \% \text { stock, } \$ 100 \text { par } & 1,000,000 \\\text { Common stock, } \$ 10 \text { par } & 2,000,000\end{array}$ Income before income tax was $1,500,000, and income taxes were $200,000 for the current year. Cash dividends paid on common stock during the current year totaled $150,000. The common stock sells for $75 per share at the end of the year.

?Determine each of the following:
(a)Times interest earned
(b)Earnings per share on common stock
(c)Price-earnings ratio
(d)Dividends per share of common stock
(e)Dividend yield?Round to one decimal place except earnings per share and dividends per share, which should be rounded to two decimal places.

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Definitions:

Taxable Income

The amount of an individual's or organization's income used to determine how much tax is owed, minus deductions and exemptions.

Federal Taxes

Taxes imposed by the federal government on income, property, and consumption to fund national programs and services.

Gross Income

The total earnings received before any deductions such as taxes, benefits, and expenses.

Taxable Income

The portion of an individual's or entity's income that is subject to taxation by governing authorities.