Financial information for Forever 18 includes the following selected data (in millions): ($ in millions) 2018 2017 Net income $243 $252 Dividends on preferred stock $30 $25 Average shares outstanding (in millions)$300 $350 Stock price $11.77 $10.72 Calculate the price-earnings ratio in 2017 and 2018. Farrell Company has provided the following data: Common stock: 30,000 Market value, December 31 $165,000 Shares outstanding Book value, December 31 Dividends paid $50,000 $90,000 Preferred stock, 10 %, $100 par $100,000 Net income $150,000 Interest on long-term debt The price-earnings ratio is: $15,000

Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter13: Financial Statement Analysis
Section: Chapter Questions
Problem 13.16E
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Financial information for Forever 18 includes the following selected data (in millions):
($ in millions) 2018 2017
Net income $243 $252
Dividends on preferred stock $30
$25
Average shares outstanding (in millions)$300 $350
Stock price
$11.77 $10.72
Calculate the price-earnings ratio in 2017 and 2018. Farrell Company has provided the following data:
Common stock:
30,000
Market value, December 31 $165,000
Shares outstanding
Book value, December 31
Dividends paid $50,000
$90,000
Preferred stock, 10 %, $100 par $100,000
Net income $150,000
Interest on long-term debt
The price-earnings ratio is:
$15,000
Transcribed Image Text:Financial information for Forever 18 includes the following selected data (in millions): ($ in millions) 2018 2017 Net income $243 $252 Dividends on preferred stock $30 $25 Average shares outstanding (in millions)$300 $350 Stock price $11.77 $10.72 Calculate the price-earnings ratio in 2017 and 2018. Farrell Company has provided the following data: Common stock: 30,000 Market value, December 31 $165,000 Shares outstanding Book value, December 31 Dividends paid $50,000 $90,000 Preferred stock, 10 %, $100 par $100,000 Net income $150,000 Interest on long-term debt The price-earnings ratio is: $15,000
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