General accounting Plush Pilots, Inc., has balance sheet equity of $5.4 million. At thesame time, the income statement shows net income of $783,000.The company paid dividends of $438,480 and has 100,000 shares ofstock outstanding. If the benchmark PE ratio is 18, what is the targetstock price in one year?

Step 1: Detailed Explanation of Price-Earnings RatioThe Price-Earnings (P/E) ratio measures the…

Answered: Plush Pilots, Inc., has balance sheet…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Plush Pilots, Inc., has balance sheet equity of $5.4 million. At the same time, the income statement shows net income of $783,000. The company paid dividends of $438,480 and has 100,000 shares of stock outstanding. If the benchmark PE ratio is 18, what is the target stock price in one year?