USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 174

Multiple Choice

USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
Modular Industries currently has a 16 percent annual growth rate, while the market average is 6 percent. The market multiple is 10.
-Refer to Exhibit 9.11. Determine the P/E ratio for Modular Industries assuming Modular can maintain its superior growth rate for the next eight years.

• A) 6.4
• B) 20.5
• C) 16.5
• D) 23.8
• E) 29.5

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Definitions:

Petty Cash Fund

A small amount of cash kept on hand to pay for minor, incidental expenses of a business, recorded as a current asset on the balance sheet.

Cash Short

A situation where the actual cash on hand is less than the recorded amount in the accounting records, often resulting in a discrepancy during reconciliation.

Petty Cash Receipts

Documentation of small amounts of cash expenditures from a petty cash fund, used for minor business expenses.

Internal Control Problems

Weaknesses or failures in a company’s system of policies and procedures that govern its operations and financial reporting.