Hi its me again I'm having trouble in calculating the following ratios for the questions..could someone please give me the guidance? Earnings per share 26.7 return on equity return on investment stock turnover I follow the equations but i couldn't get the answer THanks!
According to ASET, you need to construct the income statement and balance sheet first using the information given in the question first, then calculate the ratios. From the income statement, you can get 92000 profit after tax for 2004, then minus the preference share dividend payment 12000 and divide the total shares number: (92000-12000)/300000=26.67p Hope this helps
Yes, Annie is right. First we have to construct Income Statement, then Balance Sheet for two years. From the figures, one can easily analyse the ratios and measure the performance of the company. Cheers!
return on investments Could anyone help me identify what to include as investments for the return on investments please?
Hi For "return on investment" or "return on capital employed", we've got a choice of definition. Let's say we go for the definition: net profit before tax and interest / (share capital & reserves + long-term debt) Then for investments (doing the 2004 figures), we'd have: share capital = ordinary + prefernce = 300 + 150 reserves = share premium + retained earnings = 10 + 250 long-term debt = 200 The trickiest of these numbers is probably the 250, requires us to construct an income statement as it's not one we can pick to directly from the question. Hope this helps Lynn
