A Company Has 15,000 Shares of Stock Outstanding, a Net

question 122

Multiple Choice

A company has 15,000 shares of stock outstanding, a net income of $68,000, and a stock price of $73.25. What is the price-earnings ratio?

• A) 16.16
• B) 17.45
• C) 15.08
• D) 19.32
• E) 18.37

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Definitions:

Stockholders' Equity

The residual interest in the assets of a corporation after deducting liabilities, representing the owners' claim on the company's assets.

Note Payable

A documented commitment to repay a certain sum of money along with interest at an agreed-upon date in the future.

Long-term

Refers to assets, liabilities, or investments expected to be held or relevant for a period exceeding one year.

Current Liabilities

Obligations or debts that a company expects to pay or settle within one year.