Both Trailing and Projected P/E Ratios Are of Interest to Investors

question 326

True/False

Both trailing and projected P/E ratios are of interest to investors.

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Definitions:

Prepaid Expenses

Future expenses that have been paid in advance and are accounted for as assets on a balance sheet until they are incurred.

Accrual Basis

An accounting method that records revenues and expenses when they are earned or incurred, regardless of when the cash is actually exchanged.

Accounts Receivable

Amounts due to a company from its clients for the supply of goods or services, which have yet to be paid for.

Accounts Payable

The amount of money a company owes to its creditors for goods or services purchased on credit.