Goodman Company had a net income of $672,000 for 2008. Goodman Companys balance sheet disclosed the stockholders

Question:

Goodman Company had a net income of $672,000 for 2008. Goodman Company’s balance sheet disclosed the stockholders’ equity on December 31, 2008, as follows:

Preferred stock, 8,000 shares of $100 par value, 6% stock ......... $ 800,000

Common stock, 120,000 shares of $1 par value stock issued and outstanding .. 120,000

Paid-in capital in excess of par value .................. 2,400,000

Total stockholders’ equity ..................... $3,320,000

The price of Goodman common stock was $72.80 per share on December 31, 2008. Determine the price-earnings ratio for Goodman Company.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...