Bright Sky Inc. has reported total earnings of $610,000 for the year. The company has 125,000 shares of stock outstanding, and its P/E ratio is 20. 5. What is the estimated stock price using the P/E multiples approach?

Bright Sky Inc. has reported total earnings of $610,000 for the year. The company has 125,000 shares of stock outstanding, and its P/E ratio is 20. 5. What is the estimated stock price using the P/E multiples approach?

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 54E: Rebert Inc. showed the following balances for last year: Reberts net income for last year was...

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Please explain the solution to this general accounting problem with accurate explanations.

Bright Sky Inc. has reported total earnings of
$610,000 for the year. The company has
125,000 shares of stock outstanding, and its
P/E ratio is 20. 5. What is the estimated
stock price using the P/E multiples approach?

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