Bree's Tennis Supply's market-to-book ratio is currently 9.4 times and PE ratio is 20 times.

Bree's Tennis Supply's market-to-book ratio is currently 9.4 times and PE ratio is 20 times. If Bree's Tennis Supply's common stock is currently selling at $20.50 per share, what is the book value per share and earnings per share?

Multiple Choice

$1.025, $2.1809, respectively

$2.1809, $1.025, respectively

$410.00, $192.70, respectively

$192.70, $410.00, respectively

Solutions

Expert Solution

Market to book value = 9.4

Book value = Market value / 9.4

= $20.50 / 9.4

= $2.1809

PE ratio = Market price / Earning per share

20 = $20.50 / Earning per share

Earning per share = $20.50 / 20

= $1.025

Book value is $2.1809 and Earning per share is $1.025.

Junaid answered 1 year ago

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