【正文】 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin I nc om e f r om c on t i nu i ng op e r a t i on s 1 , 3 8 9 , 5 0 0$ D i s c on t i nu e d op e r a t i on s :I nc om e f r om op e r a t i ng R a di o D i v i s i on ( ne t of $ 1 0 5 , 0 0 0 i nc om e t a x e s ) 4 2 0 , 0 0 0$ Lo s s on di s po s a l of R a di o D i v i s i on ( ne t of $ 3 8 , 5 0 0 t a x be ne f i t ) ( 1 5 4 , 0 0 0 ) 2 6 6 , 0 0 0 E x t r a ordi na r y i t e m :Lo s s f r om 。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin A gain or loss that is unusual in nature and infrequent in occurrence. Extraordinary Items Extraordinary Items Net Ine A 2 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin Revenues, expenses and ine generated by the pany’s continuing operations. Continuing Operations Continuing Operations Net Ine A 2 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin This ratio identifies the return, in terms of cash dividends, on the current market price of the stock. Dividend Yield Annual Dividends Per Share Market Price Per Share = Dividend Yield $ $ = = % Dividend Yield P 3 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin N O R T O N C O R P O R A T I O ND e c e m b e r 3 1 , 2 0 0 7E a r ni ngs pe r S ha r e 1 . 9 6$ M a r k e t P r i c e 1 5 . 0 0 A nnua l D i v i de nd pe r S ha r e 2 . 0 0 Use this information to calculate the market ratios for Norton Corporation. Market Prospects P 3 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin This measure indicates how much ine was earned for each share of mon stock outstanding. Basic Earnings per Share Net Ine Preferred Dividends WeightedAverage Common Shares Outstanding = Basic Earnings per Share $53,690 0 27,400 = = $ per share Basic Earnings per Share P 3 169。 2 = Return on Common Stockholders’ Equity This measure indicates how well the pany employed the owners’ investments to earn ine. Return on Common Stockholders’ Equity P 3 169。 2 = Return on Total Assets Return on Total Assets Net Ine Average Total Assets = Return on Total Assets P 3 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin This ratio measures the amount remaining from $1 in sales that is left to cover operating expenses and a profit after considering cost of sales. Gross Margin Net Sales Cost of Sales Net Sales = = % Gross Margin $494,000 $140,000 $494,000 = Gross Margin P 3 169。 e q u i t y B e g i n n i n g o f y e a r 1 8 0 , 0 0 0 E n d o f y e a r 2 3 4 , 3 9 0 R e v e n u e s 4 9 4 , 0 0 0 C o s t o f s a l e s 1 4 0 , 0 0 0 T o t a l a s s e t s B e g i n n i n g o f y e a r 3 0 0 , 0 0 0 E n d o f y e a r 3 4 6 , 3 9 0 P 3 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin Profit Margin Gross Margin Return on Total Assets Basic Earnings per Share Book Value per Common Share Return on Common Stockholders’ Equity Profitability P 3 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin This ratio measures the solvency of panies. Total Liabilities = Total Equity DebttoEquityRatio DebttoEquity Ratio P 3 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin Total Liabilities = Total Assets Debt Ratio This ratio measures what portion of a pany’s assets are contributed by creditors. $112,000 = $346,390 Debt Ratio = % Debt Ratio P 3 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin Use this information to calculate the solvency ratios for Norton Corporation. N O R T O N C O R P O R A T I O N2022N e t i n c o m e b e f o r e i n t e r e s t e x p e n s e a n d i n c o m e t a x e s 8 4 , 0 0 0$ I n t e r e s t e x p e n s e 7 , 3 0 0 T o t a l s h a r e h o l d e r s 39。 2 = Total Asset Turnover Total Asset Turnover P 3 169。 365 = days Days’ Sales in Inventory P3 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin This ratio measures the liquidity of inventory. Days’ Sales in Inventory = Ending Inventory Cost of Goods Sold 180。 365 Days’ Sales Uncollected = $20,000 $494,000 180。 2 = Inventory Turnover Inventory Turnover P 3 169。 2 Accounts Receivable Turnover = P 3 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin Quick assets are Cash, ShortTerm Investments, and Current Receivables. This ratio is like the current ratio but excludes current assets such as inventories and prepaid expenses that may be difficult to quickly convert into cash. AcidTest Ratio Quick Assets Current Liabilities = AcidTest Ratio $50,000 $42,000 = : 1 = AcidTest Ratio P 3 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin Dec. 31, 2022 Current assets 65,000 $ Current liabilities (42,000) Working capital 23,000 $ Working capital represents current assets financed from longterm capital sources that do not require nearterm repayment. Working Capital P 3 169。 The McGrawHill Companies, Inc., 2022 McGrawHill/Irwin Current Ratio Acidtest Ratio Accounts Receivable Turnover Inventory Turnover Days’ Sales Uncollected Days’ Sales in Inventory Total Asset Turnover Liquidity and Efficiency P 3 169。 equity 346,390 $ 300,000 $ P 3 169。 equity: Common stock, $1 par value 27,400 17,000 Additional paidin capital 158,100 113,000 Total paidin capital 185,500 $ 130,000 $ Retained ear