Topic 17- p1+p2

Question 1

EPS

Answer 1

PAT/num.iss.shares
//pence per share//
Shows profitability of shares.

Question 2

DPS

Answer 2

Total ord. dividends / num.iss.sh
//pence per share//
what has been paid out.
Can compare to EPS to see if distributing a reasonable amnt

Question 3

DC

Answer 3

PAT / dividends paid
//num of times//
High dc means retaining high profit for reinvestment.
Low dc means paying more out too high a dividend and not ret profits.

Question 4

DY

Answer 4

*DPS/ MP PS *100 *
//percentage//
Act rate of return earned by shareholder if bought at current mp

Question 5

PE

Answer 5

MP PS / EPS
//number//
Lower the better.
Compares price of share to overall earnings.
May indicate how long it will take for earnings to cover cost of initial investment

Question 6

IC

Answer 6

PBT/ Interest paid
//num of times//
Num of times a company can safely afford to pay out interest on loans and still retain profits.

Question 7

Gearing

Answer 7

*NCL / Iss.sh.cap + res + NCL *100 *
//percentage//
(Bottom fig on SOFP)
Long term stability of the company.
Measures how much is financed by debt like LT loans and debentures.
Low is better