loader  Loading... Please wait...

Question(s) / Instruction(s):

The following information pertains to Lance Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit.


Cash and short-term investments                     $40,000

Accounts receivable (net)                                      30,000

Inventory                                                                   25,000

Property, plant and equipment                         215,000

Total Assets                                                           $310,000

Liabilities and Stockholders’ Equity          

Current liabilities                                                     $60,000

Long-term liabilities                                                 95,000

Stockholders\' equity—common                                        155,000

Total Liabilities and Stockholder’s Equity                         $310,000

Income Statement         

Sales                                                                           $90,000

Cost of goods sold                                                     45,000

Gross margin                                                              45,000

Operating expenses                                                  20,000

Net income                                                               $25,000

Number of shares of common stock                       6,000

Market price of common stock                                 $20

Dividends per share on common stock                    1.00

Cash provided by operations                                $40,000

What is the price earnings ratio for this company?

A.            6 times

B.            4.2 times

C.            4.8 times

D.            8 times

Find Similar Answers by Subject

Student Reviews

Rate and review your solution! (Please rate on a Scale of 1 - 5. Top Rating is 5.)

Expert's Answer
Download Solution:

This solution includes:

  • Plain text
  • Cited sources when necessary
  • Attached file(s)
  • Solution Document(s)

You Recently Viewed...

Reach Us