In: Finance
Please do it by type not pics.
1.You are considering an investment in Roxie's Bed & Breakfast Corp. During the last year, the firm's income statement listed an addition to retained earnings of $10.20 million and common stock dividends of $3.10 million. Roxie's year-end balance sheet shows common stockholders' equity of $44.9 million with 19 million shares of common stock outstanding. The common stock's market price per share was $9.30.
What is Roxie's Bed & Breakfast's book value per share?
What is Roxie's Bed & Breakfast's earnings per share?
Calculate the market-to-book ratio.
| Answr = 1) | ||||
| Book Value per shares = Stockhoder's Equity balance / No. of outstanding shares | ||||
| Book Value per shares = $ 44.90 Million / $ 19 Million of Shares = | $ 2.36 | |||
| Answer = 2) | ||||
| ` | CALCULATION OF EARNING PER SHARES | |||
| Earning per shares = Net Income / total Shares outstanding | ||||
| STEP 2: CALCULATION OF THE RATIO | ||||
| Earning Per shares = | ||||
| Net Income available for shareholder= | $ 10.20 | Million | ||
| Divide By | "/" By | |||
| Number of Shares Outstanding | 19 | Million | ||
| Earning Per shares = | $ 0.54 | |||
| Earning Per Shares = | $ 0.54 | |||
| Answer = 3) | ||||
| Market to Book Ratio = Market price Per shares / Book Value per shares | ||||
| Market to Book Ratio = $ 9.30 / $ 2.36 = | 3.94 | |||
| Answer = 3.94 | ||||