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What is the book value per share for underwood shares

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Reference no: EM133069901

Question - The balance sheet for Larry Underwood Motors shows a book value of stockholders' equity (book value per share x total shares outstanding) of $1,326,000.

Furthermore, the firm's income statement for the year just ended has a net income of $533,000, which is $0.253 per share of common stock outstanding. The price-earnings ratio for firms similar to Underwood Motors is 21.53.

Required -

a. What price would you expect Underwood Motors shares to sell for?

b. What is the book value per share for Underwood's shares?

Reference no: EM133069901

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