Note: Please show all working out and all steps, including the formuals used (e. g. price earnings ration, earnings per share etc). Jim wants to purchase shares in the company he works in. The company is listed on ASX and has a current share price of $3.50. Earnings in 2022 were $0.35 per share and in 2021 were $0.30 per share. The average PE for similar companies is 11.5 (based upon projected earnings for 2023). Question 1: Review this potential investment by Richards and prepare a recommendation based on your calculations.

Note: Please show all working out and all steps, including the formuals used (e. g. price earnings ration, earnings per share etc). Jim wants to purchase shares in the company he works in. The company is listed on ASX and has a current share price of $3.50. Earnings in 2022 were $0.35 per share and in 2021 were $0.30 per share. The average PE for similar companies is 11.5 (based upon projected earnings for 2023). Question 1: Review this potential investment by Richards and prepare a recommendation based on your calculations.

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 63P: Mike Sanders is considering the purchase of Kepler Company, a firm specializing in the manufacture...

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