Botox Facial Care had earnings after taxes of $304,000 in 2012 with 200,000 shares of stock outstanding.
Question:
| Botox Facial Care had earnings after taxes of $304,000 in 2012 with 200,000 shares of stock outstanding. The stock price was $82.40. In 2013, earnings after taxes increased to $394,000 with the same 200,000 shares outstanding. The stock price was $96.00. |
| a. | Compute earnings per share and the P/E ratio for 2012. (The P/E ratio equals the stock price divided by earnings per share.)(Do not round intermediate calculations. Round your final answers to 2 decimal places.) |
| Earnings per share | $ |
| P/E ratio | times |
| b. | Compute earnings per share and the P/E ratio for 2013.(Do not round intermediate calculations. Round your final answers to 2 decimal places.) |
| Earnings per share | $ |
| P/E ratio | times |
| c. | Why did the P/E ratio change?(Do not round intemediate calculations. Input your answers as percents rounded to 2 decimal places.) |
| The stock price (Click to select)decreasedincreasedbypercent while EPS (Click to select)decreasedincreasedbypercent. |
Expert Answer:
