Rather Corporation's annual report is as follows. If the current market price is $17 on March 31,2019,compute the price/earnings ratio on March 31,2019.(Round any intermediate calculations and your final answer to the nearest cent. )

Question

Rather Corporation's annual report is as follows.  If the current market price is $17 on March 31,2019,compute the price/earnings ratio on March 31,2019.(Round any intermediate calculations and your final answer to the nearest cent. )

Quizplus · Accepted Answer

Average Number of Common Shares Outstanding = (275,464 + 200,168)/ 2 = 237,816
Earnings Per Share = Net Income / Average Number of Common Shares Outstanding Earnings Per Share = $429,500 / 237,816 = $1.81
P/E Ratio = Current Market Price / EPS
P/E Ratio = $17 / $1.81 = 9.39

Rather Corporation's Annual Report Is as Follows