Romulus Industries, Inc

Finance Dec 23, 2020

Romulus Industries, Inc. has net income after tax of $112,500. The firm has 30,000 shares of stock outstanding. The market price is $18.00 per share. What is the price earnings ratio of the stock? 1.0 Points EVENT TOODI ATAS V VASCO A. 4.8x B. 5.5x C. 6.5x . D. 7.8x

Expert Solution

EPS=net income/shares of stock outstanding

=112500/30,000

=$3.75

P/E ratio=stock price/EPS

=18/3.75

=4.8x

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