FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Use this information for Kellman Company to answer the question that follow.

The balance sheets at the end of each of the first 2 years of operations indicate the following:

Kellman Company
  Year 2 Year 1
Total current assets $613,800 $574,400
Total investments 69,500 48,400
Total property, plant, and equipment 852,500 795,200
Total current liabilities 117,500 86,000
Total long-term liabilities 313,200 230,300
Preferred 9% stock, $100 par 82,100 82,100
Common stock, $10 par 595,800 595,800
Paid-in capital in excess of par—Common stock 65,300 65,300
Retained earnings 361,900 358,500

Using the balance sheets for Kellman Company, if net income is $117,000 and interest expense is $40,900 for Year 2, and the market price of common shares is $34, what is the price-earnings ratio on common stock for Year 2? (Round intermediate calculation and final answer to two decimal places.)

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