Phelps,Inc

question 30

Essay

Phelps,Inc.,had assets of $67,646 and liabilities of $15,466 at the close of 2018 with 10,718 shares of outstanding common shares.Net income for 2018 was $7,829.At the end of 2019,assets were $79,571 and liabilities were $18,551,and the company had 10,771 shares of outstanding stock.Net income for 2019 was $9,993.
a)Calculate EPS for 2019.
b)Calculate ROE for 2019.

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Definitions:

Probability of Default

The probability that a borrower will fail to fulfill their debt responsibilities.

Credit Policy

The guidelines a company follows to determine the amount and terms of credit to extend to customers.

5 C's of Credit

Refers to the five key elements a lender considers when assessing the creditworthiness of a potential borrower: character, capacity, capital, collateral, and conditions.

Conditions

Specific terms or requirements outlined in an agreement or contract, which must be met for the agreement to be fully enforceable.