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Firm A has a price-to-earnings ratio of 12.7-to-1. Firm B has recently reported earnings per share of $2.98. What is the price per share of Firm B according to the comparable multiples approach? A. $4.26 B. $12.70 C. $37.85 D. $0.24

Firm A has a price-to-earnings ratio of 12.7-to-1. Firm B has recently reported earnings per share of $2.98. What is the price per share of Firm B according to the comparable multiples approach? A. $4.26 B. $12.70 C. $37.85 D. $0.24

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter16: Financial Statement Analysis
Section: Chapter Questions
Problem 4PA: Measures of liquidity, solvency, and profitability The comparative financial statements of Marshall...
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Firm A has a price-to-earnings ratio of 12.7-to-1. Firm B has recently reported earnings per share of $2.98. What is the price per share of Firm B according to the comparable multiples approach? A. $4.26 B. $12.70 C. $37.85 D. $0.24
Transcribed Image Text:Firm A has a price-to-earnings ratio of 12.7-to-1. Firm B has recently reported earnings per share of $2.98. What is the price per share of Firm B according to the comparable multiples approach? A. $4.26 B. $12.70 C. $37.85 D. $0.24
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