Mihok Corporation Has Provided the Following Financial Data

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The Answer is a. Earnings per share = Net Income ÷ Average number of common shares outstanding*
= $10,000 ÷ 100,000 shares = $0.10 per share (rounded)
*Number of common shares outstanding = Common stock ÷ Par value
= $300,000 ÷ $3 per share = 100,000 shares
b. Price-earnings ratio = Market price per share ÷ Earnings per share
= $0.97 ÷ $0.10 = 9.70 (rounded)
c. Dividend payout ratio = Dividends per share* ÷ Earnings per share
= $0.05 ÷ $0.10 = 50.0% (rounded)
*Dividends per share = Common dividends ÷ Common shares (see above)
= $5,000 ÷ 100,000 shares = $0.05 per share (rounded)
d. Dividend yield ratio = Dividends per share* ÷ Market price per share
= $0.05 ÷ $0.97 = 5.15% (rounded)
*Dividends per share = Common dividends ÷ Common shares (see above)
= $5,000 ÷ 100,000 shares = $0.05 per share (rounded)
e. Book value per share = Common stockholders' equity ÷ Number of common shares outstanding*
= $775,000 ÷ 100,000 shares = $7.75 per share (rounded)
*Number of common shares outstanding = Common stock ÷ Par value
= $300,000 ÷ $3 per share = 100,000 shares

Mihok Corporation Has Provided the Following Financial Data

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Mihok Corporation Has Provided the Following Financial Data

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