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Estimated 2005 Income Statement and Balance Sheet Data for Ideko Corporation The following are financial ratios for three comparable companies:
-Based upon the average P/E ratio of the comparable firms,Ideko's target market value of equity is closest to:
A)$157 million
B)$155 million
C)$193 million
D)$165 million

Question

Use the tables for the question(s)below.
Estimated 2005 Income Statement and Balance Sheet Data for Ideko Corporation  The following are financial ratios for three comparable companies: 
-Based upon the average P/E ratio of the comparable firms,Ideko's target market value of equity is closest to:
A)$157 million 
B)$155 million 
C)$193 million 
D)$165 million

Quizplus · Accepted Answer

D)Average P/E = 11ea7cce_3c90_7aeb_928c_e5a95b46339d_TB1626_00 = 23.67
Price = earnings × P/E = 6.939 × 23.67 = $164.22 million

Use the Tables for the Question(s)below