contestada

Napoli Industries had net income for Year 2 of $650,000. Napoli had an average number of shares outstanding at the end of the year of 500,000 shares. On January 1, Year 2, the market price of Napoli’s stock was $20 per share. On December 31, Year 2, the market price was $22 per share. What is the price-earnings ratio for Napoli at the end of Year 2?

Respuesta :

TomShelby

Answer:

P/E = 18.33

Explanation:

price-earnings ratio

[tex]\frac{Market \: Price}{EPS}[/tex]

EPS: [tex]\frac{income - preferred \: dividends}{outstanding \: shares}[/tex]

There is no preferred stock thus, no preferred dividends.

650,000 / 500,000 = 1.3 dollars per share

22 / 1.2 = 18,33

Otras preguntas

Q&A Education