Profitability Analysis Albion Inc. provided the following information for its most recent year of operation. The tax rate is 40 percent.
1. Compute the following: (a) return on sales, (b) return on assets, (c) return on stockholders’ equity, (d) earnings per share, (e) price-earnings ratio, (f) dividend yield, and (g) dividend payout ratio.
2. Conceptual Connection: If you were considering purchasing stock in Albion, which of the above ratios would be of most interest to you? Explain.