Beer Corporation had net income of $216,000, and paid dividends to common stockholders of $43,000 in 2017. The weighted average

Question

3 years ago

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Beer Corporation had net income of $216,000, and paid dividends to common stockholders of $43,000 in 2017. The weighted average

number of shares outstanding in 2017 was 58,500 shares. Beer Corporation's common stock is selling for $79 per share on the New York Stock Exchange. Calculate Beer Corporation's price earnings ratio. Round answer to one decimal place.

Business

1 answer:

Zepler [3.9K] · Answer 1 · 2022-07-05T10:51:10+03:00

Answer:

21 times

Explanation:

Calculation to determine Beer Corporation's price earnings ratio

First step is to get Calculate the Earning per share ( EPS)

EPS=$216,000 ÷ $58,500

EPS= $3.69

Now let calculate the price earnings ratio

Price earnings ratio= $79 ÷ $3.69

Price earnings ratio= 21 times

Therefore Beer Corporation's price earnings ratio is 21 times