Basic Earnings per Share

Monona Company reported net income of $29,975 for 2016. During all of 2016, Monona had 1,000 shares of 10%, $100 par, nonconvertible preferred stock outstanding, on which the year's dividends had been paid. At the beginning of 2016, the company had 7,000 shares of common stock outstanding. On April 2, 2016, the company issued another 2,000 shares of common stock so that 9,000 common shares were outstanding at the end of 2016. Common dividends of $17,000 had been paid during 2016. At the end of 2016, the market price per share of common stock was $17.50.

Required:

1. Compute Monona's basic earnings per share for 2016. If required, round your answer to two decimal places. $_______ per share
2. Compute the price/earnings ratio for 2016. If required, round your answer to one decimal place. ________ times