Ratio analysis from given income statement.
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Lucrative Corporation
Consolidated Income Statement
Year ended December 31 (in $ millions)
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2006
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2005
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Total sales
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610.1
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578.3
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Cost of sales
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(500.2)
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(481.9)
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Gross profit
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109.9
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96.4
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Selling, general, and
administrative expenses
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(40.5)
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(39.0)
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Research and development
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(24.6)
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(22.8)
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Depreciation and amortization
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(3.6)
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(3.3)
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Operating income
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41.2
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31.3
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Other income
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---
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---
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Earnings before interest and taxes (EBIT)
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41.2
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31.3
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Interest income (expense)
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(25.1)
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(15.8)
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Pretax income
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16.1
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15.5
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Taxes
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(5.5)
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(5.3)
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Net income
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10.6
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10.2
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Price per share
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$16
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$15
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Shares outstanding (millions)
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10.2
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8.0
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Stock options outstanding (millions)
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0.3
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0.2
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Stockholders' Equity
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126.6
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63.6
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Total Liabilities and Stockholders' Equity
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533.1
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386.7
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Show calculations.
a) For the year ending December 31, 2006 what are Lucrative 's earnings per share?
b) Assuming that Lucrative has no convertible bonds outstanding. Then for the year ending December 31, 2006 what are Luther's diluted earnings per share?
c) What are Lucrative 's Operating Margin for the year ending December 31, 2005?
d) What are Lucrative's Net Profit Margin for the year ending December 31, 2005?
e) What are Lucrative 's earnings before interest, taxes, depreciation, and amortization (EBITDA) for the year ending December 31, 2006?
f) What are Lucrative's returns on equity (ROE) for the year ending December 31, 2006?
g) What is Lucrative's price - earnings ratio (P/E) for the year ending December 31, 2006?
h) If Locative's accounts receivable were $55.5 million in 2006, then calculate Luther's accounts receivable days for 2006.