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Dmitry_Shevchenko [17]
3 years ago
12

You are trying to value the common stock shares BeGood Company using a market multiples approach. Begone just reported annual ea

rnings of $1.74 per share. BeGood is a privately held corporation and has three main publicly traded competitors. Below, the most recent price/earnings multiples are presented for each competitor: Competitor P/E Multiple
BeSafe 11.20
Y-Not 13.25
R-U-Sure 14.88
Based on this information, determine the share price of BeGood. Use the market multiple approach and compute to the second decimal place
Business
1 answer:
lakkis [162]3 years ago
7 0

Answer:

$22.81

Explanation:

We can easily calculate share price for BeeGood company just by multiplying the current earnings per share with an average P/E ration of competitors

P/E = Price earning ratio

EPS = Earning per share

Formula: Share price = PE x EPS

Share price = \frac{(11.2+13.25+14.88)}{3} x $1.74

Share price = $22.81

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Becka borrowed $420 from her cousin at the rate of 8% per year. If the inflation rate was 2.5% that year, what is her cousin's a
sergij07 [2.7K]

Answer:

5.37%

Explanation:

Real rate of return = \frac{1 + NominalRate}{1 + InflationRate} -1

= \frac{1+0.08}{1+0.025} - 1

= 0.053658 or 5.37%

The cousin loaned $420 to Becka

she would expect Becka to pay back 420 x (1 + 5.37%) which is equal to $442.554

The real return on the loan = \frac{442.55-420}{420} × 100 = 5.37%

6 0
2 years ago
In three to four sentences, explain why prices decrease when the market moves from a monopoly to perfect competition?
a_sh-v [17]
When a company has a monopoly on a product, there is no other competition so that producer can price the product however high they want.  When there is competition, the product must be priced appropriately or the consumer will go to another option. Additionally, monopolies can result is a lesser quality product. 
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3 years ago
Read 2 more answers
An estimate based on an analysis of receivables shows that $790 of accounts receivables are uncollectible. the allowance for dou
erastovalidia [21]

Answer:

The  adjusting entry at the end of the year will include a credit to allowance for doubtful accounts in the amount of $910.

Explanation:

Allowance for Doubtful Accounts balance should be Credit balance, Since we have $120 debit balance and want to create $790 Allowance for Doubtful Accounts credit balance we have to credit Allowance for Doubtful Accounts by ($790 + $120 = $910) to get Allowance for Doubtful Accounts $790 Credit balance.

Therefore, The  adjusting entry at the end of the year will include a credit to allowance for doubtful accounts in the amount of $910.

7 0
3 years ago
A $300,000 bond was redeemed at 98 when the carrying value of the bond was $292,000. the entry to record the redemption would in
Kobotan [32]

Answer:

correct option is a. loss on bond redemption of $2,000

Explanation:

given data

bond = $300,000

redeemed at =  98

carrying value of bond = $292,000

to find out

entry to record the redemption would include

solution

we know here that Redemption value is

Redemption value = bond × redeemed

Redemption value = $300,000 ×98%

Redemption value =$294,000     ................1

and here Carrying value is $292,000

so we paid excess amount that is

paid excess amount = $294,000 - $292,000

paid excess amount = $2000

so here correct option is a. loss on bond redemption of $2,000

6 0
3 years ago
If goods are sold on terms fob shipping point, the ________.
dsp73
<span>Buyer normally pays the transportation costs</span>
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3 years ago
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