Profitability Analysis Albion Inc. provided the following information for its most recent year of operations. The tax rate is 40%. Sales $100,000 Cost of goods sold 45,000 Net income 10,500 Interest...

I'm stuck on this problem

Extracted text: Profitability Analysis Albion Inc. provided the following information for its most recent year of operations. The tax rate is 40%. Sales $100,000 Cost of goods sold 45,000 Net income 10,500 Interest expense 350 Assets-beginning balance 120,000 Assets-ending balance 126,000 Preferred dividends $300 Common dividends (paid December 31) $8,000 Common shares outstanding-January 1 30,000 shares Common shares outstanding-December 31 40,000 shares Average common stockholders' equity $55,000 Market price per common share $12


Extracted text: Round all answers to two decimal places except for dividend payout ratio which is rounded to four decimal places. 1. Compute the following: a. Return on sales 17.85 % b. Return on assets 8.71 % c. Return on stockholders' equity 18.45 % d. Earnings per share 0.29 e. Price-earnings ratio f. Dividend yield % g. Dividend payout ratio 2. CONCEPTUAL CONNECTION: Assume you are considering an investment to provide retirement income. Based on the above, which would be of particular interest to you? Since all the ratios are profitability ratios, they should all be of interest to investors. Some, however, may be of more interest than others depending on the objectives of the potential investor. For an investor looking for an investment to provide retirement income, the price-earnings ratio would be of particular interest.