The Following Information Pertains to Jasmin Corporation Jasmin Corporation Had 6,000 Shares of Common Stock Issued and Balance

question 28

Multiple Choice

The following information pertains to Jasmin Corporation. Assume that all balance sheet amounts represent both average and ending figures. $\begin{array}{|l|l|}\hline \text { Jasmin Corporation } \\\hline \text { Partial Balance Sheet } \\\hline \text { December 31, 20xx } \\\hline \text { Liabilities and Stockholders' Equity } \\\hline \text { Current liabilities } & \$ 60,000 \\\hline \text { Long-term liabilities } & 90,000 \\\hline \text { Stockholders' equity } & 150,000 \\\hline \text { Total liabilities and stockholders' equity } & \$ 300,000 \\\hline\end{array}$

$\begin{array}{|l|r|}\hline \text { Jasmin Corporation } \\\hline \text { Income Statement } \\\hline \text { For the Year Ended December } 31,20 \mathrm{xx} \\\hline \text { Net sales } & \$ 80,000 \\\hline \text { Cost of goods sold } & 45,000 \\\hline \text { Gross margin } & \$ 35,000 \\\hline \text { Operating expenses } & 15,000 \\\hline \text { Income before income taxes } & \$ 20,000 \\\hline \text { Income taxes expense } & 5.000 \\\hline \text { Net income } & \$ 15,000 \\\hline\end{array}$ Jasmin Corporation had 6,000 shares of common stock issued and outstanding. The market price of Jasmin common stock on December 31, 20xx, was $22.50. Jasmin paid dividends of $0.90 per share during 20xx.
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What is the price/earnings (P/E) ratio for this corporation? Round your answer to 2 decimal places.

• A) 8.00 times
• B) 10.50 times
• C) 7.00 times
• D) 9.00 times

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