PTS: 1BUSPROG: AnalyticDIF:EasyKEY: Bloom's: KnowledgeIn 2012 Robert Corporation had net income of $250,000 and paid dividends to commonyear. Robert Corporation's common stock is selling for $50 per share on the New York StockOBJ: LO: 17-0354.stockholders of $50,000. They had S0,000 shares of common stock outstanding during the entireExchange.Robert Corporation's price-earnings ratio is10 times.b. 5 times.2 times.a.c.d. 8 times.ANS: ANAT: BUSPROG: AnalyticLO: 17-03PTS: 1OBJ:DIF:ModerateKEY: Bloom's: Knowledge55. Leveraging implies that a companycontains debt financinga.b. contains

Question
Asked Dec 10, 2019
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PTS: 1
BUSPROG: Analytic
DIF:
Easy
KEY: Bloom's: Knowledge
In 2012 Robert Corporation had net income of $250,000 and paid dividends to common
year. Robert Corporation's common stock is selling for $50 per share on the New York Stock
OBJ: LO: 17-03
54.
stockholders of $50,000. They had S0,000 shares of common stock outstanding during the entire
Exchange.
Robert Corporation's price-earnings ratio is
10 times.
b. 5 times.
2 times.
a.
c.
d. 8 times.
ANS: A
NAT: BUSPROG: Analytic
LO: 17-03
PTS: 1
OBJ:
DIF:
Moderate
KEY: Bloom's: Knowledge
55. Leveraging implies that a company
contains debt financing
a.
b. contains
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PTS: 1 BUSPROG: Analytic DIF: Easy KEY: Bloom's: Knowledge In 2012 Robert Corporation had net income of $250,000 and paid dividends to common year. Robert Corporation's common stock is selling for $50 per share on the New York Stock OBJ: LO: 17-03 54. stockholders of $50,000. They had S0,000 shares of common stock outstanding during the entire Exchange. Robert Corporation's price-earnings ratio is 10 times. b. 5 times. 2 times. a. c. d. 8 times. ANS: A NAT: BUSPROG: Analytic LO: 17-03 PTS: 1 OBJ: DIF: Moderate KEY: Bloom's: Knowledge 55. Leveraging implies that a company contains debt financing a. b. contains

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Step 1

Calculate the earnings per share.

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Net income Earnings per share (EPS) = Number of outstanding shares $250,000 50,000 shares = $5 per share

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Step 2

Calculate the price-earnings ...

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Market value per share Price-earnings ratio Earnings per share $50 $5 =10 times

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