Blue Company Reported -
the Price-Earnings Ratio Per Ordinary Share Is:
A) 1

question 66

Multiple Choice

Blue Company reported:
$$\begin{array} { l l } \text { Share price } & \$ 18 \\\text { Net profit } & \$ 3,000 \\\text { Preference dividend } & \$ 500 \\\text { Ordinary dividend } & \$ 1,000 \\\text { Issued ordinary shares } & 1,000 \text { shares }\end{array}$$
-
The price-earnings ratio per ordinary share is:

• A) 1.8:1.
• B) 7.2:1.
• C) 5.0:1.
• D) 3.0:1.

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Definitions:

Drawer

A drawer is a person or entity that issues or writes a check or draft, instructing a bank or similar institution to pay a specific amount of money to a designated party.

Drawee

The party on whom a cheque or draft is drawn, responsible for paying the specified amount on the instrument.

Payee

The party in a financial transaction who receives the payment.

Unconditional Promise

A firm commitment or guarantee without any stipulations or requirements for its fulfillment.