The information below was extracted from the most recent financial statements of Milton Technologies (in millions,except for stock price): What is the P/E ratio for the company's stock for the current year?
A)17.7
B)15.3
C)14.2
D)13.9

Question

The information below was extracted from the most recent financial statements of Milton Technologies (in millions,except for stock price):  What is the P/E ratio for the company's stock for the current year?
A)17.7 
B)15.3 
C)14.2 
D)13.9

Quizplus · Accepted Answer

EPS = (Net income − Preferred dividends)÷ Average number of common shares outstanding
= $89,000 ÷ [(30,000 + 35,000)÷ 2] = $2.74 (rounded)
P/E ratio = Market price ÷ EPS
= $42.00 ÷ $2.74 = 15.3 (rounded)

The Information Below Was Extracted from the Most Recent Financial