Acc205 Principles of Accounting
P15-35 Using ratios to evaluate a stock investment [20-25 min]
This problem continues the Draper Consulting, Inc., situation from Problem 14-33 of Chapter 14.
Requirement:
1. Using the results from Chapter 4, and knowing that the current market price of Draper's stock is $200 per share, calculate the following ratios for the company:
a. Current ratio
b. Debt ratio
c. Debt to equity ratio
d. Earnings per share
e. P/E ratio
f. Rate of return on total assets
g. Rate of return on common stockholders' equity