In the previous problem, what is the P/E ratio if the firm sells at two times book

Question:

In the previous problem, what is the P/E ratio if the firm sells at two times book value per share?

Previous problem

Phelps Labs has assets of $1,800,000, current liabilities of $595,000, and long-term liabilities of $630,000. There is $165,000 in preferred stock outstanding; 20,000 shares of common stock have been issued.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...

Fantastic news! We've Found the answer you've been seeking!