1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Leto [7]
3 years ago
9

Water Front Rentals has 20,000 shares of stock outstanding at a market price of $24 each and earnings per share of $1.84. The fi

rm has decided to repurchase $75,000 worth of stock. What will the PE ratio be after the repurchase, all else held constant
Business
1 answer:
OLga [1]3 years ago
7 0

Answer:

New P/E ratio = 11 .00 times

Explanation:

<em>Repurchasing the common stock would mean the company buying back certain units of of the common stock which it had earlier  issued to its common stock holders. </em>

This it could do to avoid its earning per share (EPS) not been diluted.

Price earning (P/E) ratio is the ratio of the market price of a share to its Earnings per share (EPS).

P/E = Market price / EPS

Total earnings before re-purchase = EPS × number of shares before repurchase

= $1.84× 20,000 = $36,800

The units of shares re-purchased back

= Amount paid/ Market price per share

= $75,000/24 = 3,125  units

Total number of shares after repurchase = 20,000 - 3,125 = 16875  units

New EPS  after repurchase= $36,800 / 23,125 units= 2.18

New P/E ratio = 24/2.18 = 11.00 times

New P/E ratio = 11 .00 times

You might be interested in
Operating costs incurred by a manufacturing company become either (1) part of the cost of inventory to be expensed as cost of go
Lana71 [14]

Sales salaries are expensed at the time they are incurred.

In 2020, the average sales representative's salary was $73,500. In 2020, the average salaries for comparable jobs were $147,580 for a sales manager, $69,100 for an insurance salesman, $62,990 for a realtor, and $30,940 for a retail salesperson yes you can be a millionaire or billionaire as a seller.

Sales salaries careers are well paid and he ranks third on this list of high-paying jobs without a degree. A salesperson's revenue is directly tied to their sales performance. This means that sales positions have excellent earning potential. Working in sales can be incredibly stressful.

Learn more about Sales salaries at

brainly.com/question/24825618

#SPJ4

4 0
2 years ago
Objectives are both targets and what?
icang [17]

OMG! So easy! C.Threats.

5 0
3 years ago
Economic Order Quantity computes:
Mamont248 [21]

Answer:

D: Optimum Order size​

Explanation:

Economic Order Quantity (EOQ) is a formula applied in logistic and supply chain management to calculate a business's ideal order size. As the name suggests, the order EOQ provides an order quantity that makes economic sense.

Economies of scale suggest that a bigger order size is better because the business will save transport costs. However, ordering in large quantities increases the cost of holding stock. The economic order quantity strikes a balance between these two important factors.

7 0
3 years ago
Consumers are most likely to find the best prices in:
vladimir2022 [97]
Consumers are most likely to find the best prices in an oligopoly
8 0
2 years ago
How do investment bankers generate revenues for their firms?
Lesechka [4]
The answer is C they but at a discount, the entire issues of new security....
3 0
3 years ago
Read 2 more answers
Other questions:
  • One advantage for Dell in using blogs is ______ to customers while engaging in conversation that builds better relationships. Mu
    12·1 answer
  • Individuals with the primary responsibility for administering the systems that house the information used by the organization pe
    8·1 answer
  • Doss is vice president of marketing research for General Mills. The chefs at General Mills bring three new cookie recipes to Dos
    6·1 answer
  • Turbo Technology Corp. recently went public with an initial public offering of 3.03 million shares of stock. The underwriter use
    10·1 answer
  • The Jay Group hires better employees than its competition by conducting effective searches and multi-tiered interviews. The comp
    14·1 answer
  • Which describes a type of tax that people pay on money they earn?
    5·2 answers
  • Dana spends several hours researching prices and online reviews of t-shirts for a school
    14·1 answer
  • Indicate by how much net income in the income statement is higher or lower if the adjustment is not recorded. (Do not round inte
    8·1 answer
  • For Accounting, I need help knowing how to journalize the following transaction:
    6·1 answer
  • 7200 shares of treasury stock of Coronado, Inc., previously acquired at $13 per share, are sold at $19 per share. The entry to r
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!