Earnings per Share and Price-Earnings Ratio A company reports the following: Net income $410,000 Preferred dividends $60,000 Shares of common stock outstanding 50,000 Market price per share of common stock $84 a. Determine the company's earnings per share on common stock.$ b. Determine the company's price-earnings ratio.
Earnings per Share and Price-Earnings Ratio A company reports the following: Net income $410,000 Preferred dividends $60,000 Shares of common stock outstanding 50,000 Market price per share of common stock $84 a. Determine the company's earnings per share on common stock.$ b. Determine the company's price-earnings ratio.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Earnings per Share and Price-Earnings Ratio
A company reports the following:
Net income | $410,000 |
Preferred dividends | $60,000 |
Shares of common stock outstanding | 50,000 |
Market price per share of common stock | $84 |
a. Determine the company's earnings per share on common stock.
$
b. Determine the company's price-earnings ratio.
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