Question

Some recent financial statements for Smolira Golf, Inc., follow.

SMOLIRA GOLF, INC. Balance Sheets as of December 31, 2015 and 2016
	2015				2016					2015				2016
Assets									Liabilities and Owners’ Equity
Current assets									Current liabilities
Cash	$	2,821			$	2,657			Accounts payable	$	2,218			$	2,730
Accounts receivable		4,702				5,651			Notes payable		1,815				2,246
Inventory		12,738				13,652			Other		103				120
Total	$	20,261			$	21,960			Total	$	4,136			$	5,096
									Long-term debt	$	14,600			$	17,360
									Owners’ equity
									Common stock and paid-in surplus	$	44,500			$	44,500
Fixed assets									Accumulated retained earnings		15,719				40,061
Net plant and equipment	$	58,694			$	85,057			Total	$	60,219			$	84,561
Total assets	$	78,955			$	107,017			Total liabilities and owners’ equity	$	78,955			$	107,017

SMOLIRA GOLF, INC. 2016 Income Statement
Sales			$	189,970
Cost of goods sold				127,503
Depreciation				5,203
EBIT			$	57,264
Interest paid				1,300
Taxable income			$	55,964
Taxes				19,587
Net income			$	36,377
Dividends	$	12,035
Retained earnings		24,342

Smolira Golf has 11,000 shares of common stock outstanding, and the market price for a share of stock at the end of 2016 was $90.
  
What is the price–earnings ratio? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
  
Price–earnings ratio             times
  
What is the price–sales ratio? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
  
Price–sales ratio             times
  
What are the dividends per share? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
  
Dividends per share            $
  
What is the market-to-book ratio at the end of 2016? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
  
Market-to-book ratio             times

Answer 1

Price-Earnings Ratio

Earnings per share (EPS) = Net Income / Number of shares

= $36,377 / 11,000 shares

= $3.31 per share

Price-Earnings Ratio = Market Price per share / Price-Earnings Ratio

= $90.00 / $3.31 per share

= 27.21 Times

Price–sales ratio

Sales per share = Sales / Number of shares

= $189,970 / 11,000 shares

= $17.27 per share

Price–sales ratio = Market Price per share / sales per share

= $90.00 / $17.27

= 5.21 Times

Dividend per share

Dividend per share = Dividend paid / Number of shares

= $12,035 / 11,000 shares

= $1.09 per share

Market-to-book ratio

Book value per share = Stockholders Equity / Number of shares

= $84,5461 / 11,000 shares

= $7.69 per share

Market-to-book ratio = Market Price per share / Book value per share

= $90.00 /$7.69

= 11.71 Times