The Price-Earnings Ratio Is Another Tool Used to Measure the Value

question 47

True/False

The price-earnings ratio is another tool used to measure the value of common stock.

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Definitions:

Debit Side

The Debit Side of an account records increases in assets or expenses and decreases in liabilities, equity, and income in double-entry bookkeeping.

Rules Of Debit

Rules governing the increase or decrease in account balances within the double-entry bookkeeping system, where debits typically increase assets or expenses and decrease liabilities, equity, and revenue.

Credit Side

The right side of an accounting entry, indicating increases in liabilities, revenues, and equity, and decreases in assets and expenses.

Normal Balance

The side (debit or credit) on which increases to an account are recorded, depending on the type of account.