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aksik [14]
3 years ago
5

Suppose that the MC Software Corporation earns a profit of $10 per share. If the prevailing interest rate is 12 percent and the

stock is currently selling for $100 per share, what is the current price/earnings ratio
Business
1 answer:
dsp733 years ago
4 0

Answer:

Price Earning Ratio = Price/Earnings = we use the general formula.

\frac{100}{10}

$100/$10 = 10 times

Explanation:

Price Earning ratio is calculated using the current market price of share and earnings per share of the company. In the given question there is no relevance of interest rate as this is not the cost of equity.

Price Earning Ratio tells how much earnings are required to meet the cost of 1 share.

Another formula for P/E ratio = 1/Cost of Equity. Since 12% is not cost of equity this formula cannot be used.

Also earnings per share is given assumed it is after interest cost if any.

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Gallonte Inc. began operations in April of this year. It makes all sales on account, subject to the following collection pattern
mario62 [17]

Answer:

Total cash collection May= $60,000

Explanation:

Giving the following information:

Cash collection:

30% are collected in the month of sale

60% are collected in the first month after sale

10% are collected in the second month after sale.

Sales:

April= $60,000

May= $80,000

<u>We need to calculate the cash collection for May:</u>

Cash collection:

Sales in cash May= (80,000*0.3)= 24,000

Sales in account from April= (60,000*0.6)= 36,000

Total cash collection May= $60,000

7 0
3 years ago
Which of the following statements about the inclusion of boot in a nontaxable exchange is false? Multiple Choice The purpose of
ankoles [38]

<u>Answer:</u>

<em>The purpose of including boot in a nontaxable exchange is to equalize the adjusted tax bases of the properties exchanged. </em>

<em></em>

<u>Explanation:</u>

A nontaxable exchange is a trade wherein you are not exhausted on any addition, and you cannot deduct any loss. On the off chance that you get property in a "nontaxable business", its premise usually is equivalent to the assumption of the property you moved. A nontaxable increase or misfortune is otherwise called an unrecognized addition or misfortune.

3 0
3 years ago
Explain what is meant by "Information Technology (IT) flattens organizations?
Shalnov [3]

Answer: The answer is given below

Explanation:

Information Systems are the networks of both the hardware and the software which is used by economic agents to collect, process, create and help in the distribution of data.

Information Technology (IT) flattens organizations simply means that information systems can help in the reduction of the levels in an organization through the provision of information to managers which will be used in the supervision of other emoloyees and also, lower-level employees could be given more authority relating to decision-making.

Since decision making has been pushed to lower level then fewer managers will be needed. This ensures that faster decision making are made and there's increase in the span of control.

5 0
3 years ago
The Federal Application for Student Aid (FAFSA) form:
jarptica [38.1K]
Sorry im new to this
3 0
3 years ago
Which of the following is consistent with the law of​ supply? A. The state of Washington has less apple regulation than Californ
GuDViN [60]

Answer:

D) A doubling of the price of salt led to 5 percent drop in the quantity of salt purchased.

Explanation:

Law of supply in economics says that when the price increases the supply too increases if other factors is is constant.

Therefore, among the given options the only option that is consistent with the law of​ supply is "A doubling of the price of salt led to a 5 percent drop in the quantity of salt purchased"

4 0
3 years ago
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