Reference no: EM132081700

Question - Harvest Corporation's capital stock at December 31 consisted of the following: (a) Common stock, $2 par value; 100,000 shares authorized, issued, and outstanding. (b) 10% noncumulative, nonconvertible preferred stock, $100 par value; 1,000 shares authorized, issued, and outstanding. Harvest's common stock, which is listed on a major stock exchange, was quoted at $4 per share on December 31. Harvest's net income for the year ended December 31 was $50,000. The yearly preferred dividend was declared. No capital stock transactions occurred. What was the price- earnings ratio on Harvest's common stock at December 31?