"Company B, is a private company that designs, manufactures and distributes certain consumer products. In this fiscal year, Company B had revenues of $60 Millions of USDs and earnings of $40 of Millions of USDs. Company B has filed a registration statement with the SEC for its IPO. If the industry average Price/Earnings ratio and Price/Revenues ratio for the recent fiscal year were 10 and 0.7 respectively. Estimate the IPO price for Company B using the Price/Earnings ratio and assuming that they will issue 10 Million shares."

"Company B, is a private company that designs, manufactures and distributes certain consumer products. In this fiscal year, Company B had revenues of $60 Millions of USDs and earnings of $40 of Millions of USDs. Company B has filed a registration statement with the SEC for its IPO. If the industry average Price/Earnings ratio and Price/Revenues ratio for the recent fiscal year were 10 and 0.7 respectively. Estimate the IPO price for Company B using the Price/Earnings ratio and assuming that they will issue 10 Million shares."

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter1: The Role Of Accounting In Business

Section: Chapter Questions

Problem 1.6.2MBA: Return on assets ExxonMobil Corporation (XOM) explores, produces, and distributes oil and natural...

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