The following information relates to Truman Unlimited for the past two years. The price-earnings ratio for the current year is

Question

The following information relates to Truman Unlimited for the past two years.  The price-earnings ratio for the current year is

Quizplus · Accepted Answer

The price-earnings ratio for the current year can be calculated by dividing the market price per share by the earnings per share. The market price per share for the current year is $24, and the earnings per share for the current year are $2.50. Therefore, the price-earnings ratio for the current year is 9.60 ($24/$2.50).

The Following Information Relates to Truman Unlimited for the Past