Explain the significance of a high price-earnings ratio

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Reference no: EM131296174

1. Explain the significance of a high price-earnings ratio.

2. Indicate how each event affects the elements of financial statements. Use the following letters to record your answer in the box shown below each element. You don not need to enter amounts.

Increase = I Decrease = D No Effect = N

The Hamilton Corporation began operations by issuing 5,000 shares of $10 stated-value stock at $12. Indicate the effects of this transaction on the financial statements.

a. Assets

b. Liabilities

c. Equity

d. Revenues

e. Expenses

f. Net Income

g. Cash Flow

Reference no: EM131296174

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