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    Question

    Byron Ltd reported ₹32,000 in earnings with 40,000

    shares outstanding. The current market price is ₹18 per share and book value is ₹16. The P/E Ratio is _____
    A 20.00 Correct Answer Incorrect Answer
    B 22.50 Correct Answer Incorrect Answer
    C 2.00 Correct Answer Incorrect Answer
    D 2.25 Correct Answer Incorrect Answer
    E 17.77 Correct Answer Incorrect Answer

    Solution

    Earnings Per Share (EPS) =   𝑇𝑜𝑡𝑎𝑙 𝐸𝑎𝑟𝑛𝑖𝑛𝑔𝑠 / 𝑁𝑜 . 𝑜𝑓 𝑆ℎ𝑎𝑟𝑒𝑠 = 32,000/40,000 = 0.80   P/E Ratio = 𝑀𝑎𝑟𝑘𝑒𝑡 𝑃𝑟𝑖𝑐𝑒 / 𝐸𝑃𝑆 18 / 0.80 =22.5

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