The Balance Sheet for Blan Corporation at the End of the Current

question 62

Essay

The balance sheet for Blan Corporation at the end of the current year indicates the following:
Bonds payable,8% $4,000,000
6% Preferred stock,$100 par 1,000,000
Common stock,$10 par 2,000,000
Income before income taxes was $480,000 and income taxes expense for the current year amounted to $144,000.Cash dividends paid on common stock were $300,000,and the common stock was selling for $22 per share at the end of the year.There were no ownership changes during the year.
Required:
Calculate each of the following:
a.Earnings per share
b.Price/earnings ratio
c.Dividend payout ratio
Unit 12-3,

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Definitions:

Service Company

A business entity that provides professional services, expertise, or support to its clients rather than physical goods.

Gross Profit

The difference between revenue and the cost of goods sold, reflecting the core profitability of a company's operations.

Operating Expenses

Costs related to the normal day-to-day operations of a business, excluding the cost of goods sold.