The Following Information Pertains to Patterson Corporation

question 87

Multiple Choice

The following information pertains to Patterson Corporation.Assume that all balance sheet amounts represent both average and ending figures. Patterson Corporation had 6,000 shares of common stock issued and outstanding.The market price of Patterson common stock on December 31,20x5,was $23.Patterson paid dividends of $0.90 per share during 20x5.
What is the price/earnings (P/E) ratio for this corporation? Round your answer to two decimal places.

• A)5.47 times
• B)7.13 times
• C)4.80 times
• D)6.13 times

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Definitions:

Distorting Tax

A tax that alters the economic behavior of individuals and businesses from what they would have chosen in the absence of the tax.

Economic Welfare

The overall well-being of individuals and societies, often assessed by factors such as wealth, health, and happiness.

Benefits-Received Principle

The concept that those who benefit from public goods and services should bear the costs of providing them, in proportion to the benefit received.

Progressive Income Tax

A tax system where the tax rate increases as the taxable amount increases, placing a higher burden on wealthier individuals.