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Compute financial ratios for Donna Szabo Corporation

See attached file.

Required:

a. Compute or determine the following for the years 2003-2007.
1. Degree of financial leverage
2. Earnings per common share
3. Price/earnings ratio
4. Percentage of earnings retained
5. Dividend payout
6. Dividend yield
7. Book value per share
8. Materiality of options (use stock options outstanding)
b. Comment from the perspective of an investor.

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Consecutive five-year balance sheets and income statements of Donna Szabo Corporation are shown below
and on the following page.

Required
a. Compute or determine the following for the years 2003-2007.
1. Degree of financial leverage
2. Earnings per common share
3. Price/earnings ratio
4. Percentage of earnings retained
5. Dividend payout
6. Dividend yield
7. Book value per share
8. Materiality of options (use stock options outstanding)
b. Comment from the perspective of an investor.

Donna Szabo Corporation
Balance Sheets
December 31, 2003 through December 31, 2007
(Dollars in thousands) 2007 2006 2005 2004 2003
Assets
Current assets:
Cash $ 26,000 $ 27,000 $ 29,000 $ 28,000 $ 27,000
Accounts receivable, net 125,000 126,000 128,000 130,000 128,000
Inventories 140,000 143,000 145,000 146,000 144,000
Total current assets 291,000 296,000 302,000 304,000 299,000
Property, plant, and
equipment, net 420,000 418,000 417,000 418,000 415,000
Total assets $711,000 $714,000 $719,000 $72,000 $714,000
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $120,000 $122,000 $122,500 $124,000 $125,000
Income taxes 12,000 13,000 13,500 13,000 ...

Solution Summary

The expert computes financial ratios for Donna Szabo Corporations are examined.

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