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RoseWind [281]
1 year ago
11

Makers Corp. had additions to retained earnings for the year just ended of $285,000. The firm paid out $180,000 in cash dividend

s, and it has ending total equity of $4.85 million. The company currently has 150,000 shares of common stock outstanding.
1. What is the price-earnings ratio?

2. If the company had sales of $5.19 million, what is the price-sales ratio?
Business
1 answer:
bogdanovich [222]1 year ago
5 0

Answer:

Price-Earning ratio = 6.42

Price to Sales Ratio = 1.35

Explanation:

Earning for the year = $285,000

Common stock outstanding = 150,000 shares

* Price has not been given in the question. Assuming $70 is the market price of the share.

1.

Earning per share =  Earning for the year / Common stock outstanding

Earning per share = $285,000 / 150,000 = $1.90 per share

Price-Earning ratio = $7 / $1.90 = 6.42

2.

Price to Sales Ratio = Price / Sales = $7 / $5.19 = 1.35

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The correct answer is letter "E": A price war.

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jek_recluse [69]

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On February 2, 2016, the Farmer Corporation issued 9,000 shares of no-par stock for $17 per share. Within two hours of the issue
hichkok12 [17]

Answer:

D. 189,000 = NA + 189,000 NA - NA = NA 189,000 FA

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Equity which represents the amount owed to the owners of the business includes retained earnings (which is the accumulation of the net income/loss over the years less dividends paid) and common shares.

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Answer:

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