The asset to equity ratio for a firm is 1.5,and the firm has total assets of $3,000,000.Last year,net income for the firm was $250,000,and the earnings per share for the firm was reported as $0.50.What is the current book value per share for the firm?

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Quizplus · Accepted Answer

1.5=3,000,000/x; X=shareholder equity=$2,000,000
EPS=$0.50=$250,000/Y; Y= # of shares = 500,000
Book value per share = $2,000,000/500,000 = $4

The Asset to Equity Ratio for a Firm Is 1