Richards Corporation had net income of $250,000 and paid dividends to common stockholders of $50,000. It...

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Richards Corporation had net income of $250,000 and paid dividends to common stockholders of $50,000. It...

Richards Corporation had net income of $250,000 and paid dividends to common stockholders of $50,000. It had 50,000 shares of common stock outstanding during the entire year. Richards Corporation's common stock is selling for $35 per share. The price-earnings ratio is

a. 14 times

b. 5 times

c. 7 times

d. 2 times

business accounting

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Answer 1

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Answer #1

PE Ratio = Stock price÷ Earnings per share

= $35/($250,000/50,000)

= 7 times

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Answer 2

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Richards Corporation had net income of $250,000 and paid dividends to common stockholders of $50,000. It...

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