Use the Table for the Question(s) Below

question 62

Multiple Choice

Use the table for the question(s) below.
Consider the following income statement and other information:

-Luther's price - earnings ratio (P/E) for the year ending December 31,2006 is closest to:

• A) 7.9
• B) 10.1
• C) 15.4
• D) 16.0

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Definitions:

Statement of Cash Flows

A financial report that shows how changes in balance sheet accounts and income affect cash and cash equivalents, analyzing a company’s financing, investing, and operating activities.

Operating Activities

Transactions related to the primary business activities, detailed in the cash flow statement.

Merchandising Company

A business that purchases finished goods for resale, making a profit on the difference between the sale price and the purchase price.

Cash Outflow

Money or cash spent by a company for operating expenses, investments, and financing activities.