Which of the following statements regarding the price/earnings ratio is incorrect?
A) The price/earnings ratio represents the market price of one share of common stock.
B) A price/earnings ratio of 9.2 implies that the company's stock is selling at 9.2 times one year's earnings per share.
C) A higher price/earnings ratio signifies a higher return on investment.
D) The price/earnings ratio is most useful when comparing one company to another.
A) The price/earnings ratio represents the market price of one share of common stock.
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Assets no longer used in operations are accounted for in essentially the same manner as those used in operations.
Answer the following statement true (T) or false (F)
According to the text, the collection process of secondary data is rapid and easy compared to the collection process of primary data
Indicate whether the statement is true or false
On July 1, 2018, Sanchez Company purchased merchandise inventory for $350,000 by signing a note payable. The note is for 6 months and bears interest at a rate of 8%. Prepare the journal entry for this transaction, using a perpetual inventory system. Omit explanation.
What will be an ideal response?
If sales increase 25%, EBIT increases 50%, debt increases 75%, and working capital increases 12.5%, what is the degree of operating leverage?
A) 2 B) 5 C) 3 D) 6 E) 4