Question

Presented here are summarized data from the balance sheets and income statements of Wiper Inc.:

WIPER INC.
Condensed Balance Sheets
December 31, 2020, 2019, 2018
(in millions)
	2020			2019			2018
Current assets	$	679		$	898		$	743
Other assets		2,414			1,921			1,720
Total assets	$	3,093		$	2,819		$	2,463
Current liabilities	$	563		$	804		$	711
Long-term liabilities		1,522			988			833
Stockholders’ equity		1,008			1,027			919
Total liabilities and stockholders' equity	$	3,093		$	2,819		$	2,463

WIPER INC.
Selected Income Statement and Other Data
For the year Ended December 31, 2020 and 2019
(in millions)
	2020			2019
Income statement data:
Sales	$	3,051		$	2,914
Operating income		297			311
Interest expense		85			66
Net income		194			189
Other data:
Average number of common shares outstanding		41.4			46.8
Total dividends paid	$	51.0		$	52.4

1. If Wiper's stock had a price/earnings ratio of 14 at the end of 2020, what was the market price of the stock?
2. Calculate the cash dividend per share for 2020 and the dividend yield based on the market price calculated in part e.
3. Calculate the dividend payout ratio for 2020.
4. Assume that accounts receivable at December 31, 2020, totaled $310 million. Calculate the number of days' sales in receivables at that date.
5. Calculate Wiper's debt ratio and debt/equity ratio at December 31, 2020 and 2019.
6. Calculate the times interest earned ratio for 2020 and 2019.

Answer 1