The Following Information Was Provided by Joseph Company as of December

question 2

Essay

The following information was provided by Joseph Company as of December 31, Year 2:
$\begin{array}{llr} \text { Net income } &\$528,000\\ \text {Preferred stock, \( (20,000 \) shares at \( \$ 10 \) par, 4\%) } &\$200,000\\ \text {Common stock, \( (220,000 \) shares at \( \$ 1 \) par) } &\$220,000\\ \text { Paid-in capital in excess of par-common } &\$2,475,500\\ \text { Retained earnings} &\$3,824,500\\\end{array}$
On the most recent trading date, Joseph's common shares sold at $36 and the preferred shares sold at $14.
The following information on industry averages is provided:
Earnings per share $2.06
Price-earnings ratio 13.2:1
Required:
Calculate and compare Joseph Company's ratios with the industry averages shown above. (Round your answer to two decimal places.)
Discuss whether you would invest in this company.

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Definitions:

Predictive Validity

The extent to which a test or tool accurately forecasts future performance or behaviors based on its outcomes.

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A mental disorder diagnosed in children and adolescents characterized by a persistent pattern of disruptive and violent behaviors and a disregard for others.

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A personality disorder characterized by a long-term pattern of disregarding or violating the rights of others.

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A category of sleep disorders involving abnormal movements, behaviors, emotions, perceptions, or dreams.