Book value of a corporation is also known as:
net tangible asset value per share. Book value is much easier to say.
Which of the following items is not deducted to determine a corporation's net income?
dividends. Net income is determined before dividends.
Bubba Corporation has net income of $4,200,000. It has 100,000 outstanding shares of 8% preferred stock ($100 par value) and 400,000 shares of common stock ($10 par value).
What are the earnings per share of common stock?
$8.50. Subtract the preferred dividend of $800,000 (100,000 x 8% x 100) from the net income. Divide the result of $3,400,000 ($4,200,000 - $800,000) by the 400,000 common shares to obtain $8.50.
Which of the following is normally the largest asset of a manufacturing company?
Inventory. A manufacturer will normally have more inventory than accounts receivable and notes receivable. Sales is not an asset category.
A large manufacturing company has current assets of approximately $9,400,000 and current liabilities of about $4,900,000.
Which of the following statements is true about the current ratio?
it is somewhat below the standard minimum. The standard minimum current ratio for a manufacturing company is 2 to 1. The current ratio for this company is 1.92 (9,400,000 divided by 4,900,000).
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