The following information was provided by Jongeward Company as of December 31, 2012: On the most recent trading date, Jongeward's common shares sold at $36 and the preferred shares sold at $14.
The following information on industry averages is provided:
Earnings per share $3.06
Price-earnings ratio 19.2:1
Required:
1) Calculate and compare Jongeward Company's ratios with the industry averages shown above.
2) Discuss whether you would invest in this company.

Question

The following information was provided by Jongeward Company as of December 31, 2012:  On the most recent trading date, Jongeward's common shares sold at $36 and the preferred shares sold at $14.
The following information on industry averages is provided:
Earnings per share $3.06
Price-earnings ratio 19.2:1
Required:
1) Calculate and compare Jongeward Company's ratios with the industry averages shown above.
2) Discuss whether you would invest in this company.

Quizplus · Accepted Answer

The Answer of The following information was provided by Jongeward Company as of December 31, 2012:  On the most recent trading date, Jongeward's common shares sold at $36 and the preferred shares sold at $14.
The following information on industry averages is provided:
Earnings per share $3.06
Price-earnings ratio 19.2:1
Required:
1) Calculate and compare Jongeward Company's ratios with the industry averages shown above.
2) Discuss whether you would invest in this company.

The Following Information Was Provided by Jongeward Company as of December