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A Company Reports the Following

question 149

Essay

A company reports the following:
Net income$270,000
Preferred dividends$10,000
Shares of common stock outstanding20,000
Market price per share of common stock$36.40

?Calculate the company's price-earnings ratio. Round your answer to one decimal place.


Definitions:

Stock Bonus Plans

Incentive programs that grant employees equity in a company, either in the form of stock options or shares, as part of their compensation package.

Stock Purchase Plans

Programs offered by companies allowing employees to purchase company stock often at a discount, aiming to align the interests of employees and shareholders.

Stock Option Plans

A compensation strategy that gives employees the option to purchase company stock at a predetermined price at a future date.

Profit-Sharing Plans

A company-wide program that provides employees with a share in the company's profits, usually in the form of a bonus or retirement benefit.

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