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A group of seven guideline organizations within the same industry as the Dot Corporation had an average Price/Earnings ratio of 12. The Dot Corporation has
A group of seven guideline organizations within the same industry as the Dot Corporation had an average Price/Earnings ratio of 12. The Dot Corporation has $800,000 in cash, paid $180,000 in interest, has debt equal to $3,000,000, and has after-tax earnings of $900,000. Using only this information, what would be a reasonable value for the Dot Corporation?
A $3,700,000
B $6,025,000
C $8,400,000
D $10,800,000
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