May I ask for a solution and explanation to the problem for a better understanding. Thank you!Based on the data provided for Lettuce Company, what is the price-earnings ratio for years 1 and 2 respectively? a. 8; 8.40b. 8.40 ; 8c. 9; 10.2d. 10.2 ; 9 Selected data for LETTUCE Company follow:Year 2Year 1Preference share, par value P50, 10%..Ordinary share, par value P20..Share premium - ordinary share..Retained earning.P100,000 P100,000. 400,000400,000100,000100,000140,000120,00060,00010,000Net income .80,000Dividends on preference shareDividends on ordinary shareMarket price per share, Dec 31..10,00050,00040,00028.0021.00

Price-earnings ratio is the price of the share per rupee of earnings.

y I ask for a solution and explanation to the problem for a better understanding. Thank you! Based on the data provided for Lettuce Company, what is the price-earnings ratio for years 1 and 2 respectively?

y I ask for a solution and explanation to the problem for a better understanding. Thank you! Based on the data provided for Lettuce Company, what is the price-earnings ratio for years 1 and 2 respectively?

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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Question

May I ask for a solution and explanation to the problem for a better understanding. Thank you!

Based on the data provided for Lettuce Company, what is the price-earnings ratio for years 1 and 2 respectively?

a. 8; 8.40

b. 8.40 ; 8

c. 9; 10.2

d. 10.2 ; 9

Selected data for LETTUCE Company follow:
Year 2
Year 1
Preference share, par value P50, 10%..
Ordinary share, par value P20..
Share premium - ordinary share..
Retained earning.
P100,000 P100,000
. 400,000
400,000
100,000
100,000
140,000
120,000
60,000
10,000
Net income .
80,000
Dividends on preference share
Dividends on ordinary share
Market price per share, Dec 31..
10,000
50,000
40,000
28.00
21.00

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