Multiples of EPS to Value Firms Are Referred to As

question 60

Multiple Choice

Multiples of EPS to value firms are referred to as:

• A) ROA
• B) price-earnings ratios
• C) ROCE
• D) Weighted average number of common shares outstanding

---

Definitions:

Average Sale Period

A financial metric measuring the average time it takes for a company's inventory to turn into sales, often seen as part of inventory turnover analysis.

Price-earnings Ratio

A valuation metric that compares a company's current share price to its per-share earnings.

Dividend Payout Ratio

A financial metric that measures the percentage of a company's earnings paid out to shareholders as dividends, indicating how much money a company returns to shareholders versus how much it keeps to reinvest.

Gross Margin Percentage

A profitability metric calculated as gross margin (sales minus cost of goods sold) divided by sales, expressed as a percentage.