Question Details

The income statement for Pine Company for the year ended 



Ex. 1
The income statement for Pine Company for the year ended December 31, 2002 appears below.
Sales $620,000
Cost of goods sold 380,000
Gross profit 240,000
Expenses 190,000*
Net income $ 50,000
*Includes $20,000 of interest expense and $22,000 of income tax expense.
Additional information:
1. Common stock outstanding on January 1, 2002 was 50,000 shares. On July 1, 2002, 10,000
more shares were issued.
2. The market price of Pine's stock was $16 at the end of 2002.
3. Cash dividends of $30,000 were paid, $6,000 of which were paid to preferred stockholders.
Instructions
Compute the following ratios for 2002:
(a) earnings per share.
(b) price-earnings.
(c) times interest earned.



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