Question 2 (Mandatory) (1 point) The balance sheet and income statement shown below are for Koski Inc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during the next 5 years, and the notes payable will be rolled over. 2007 $2,475 12,650 17,600 $32,725 $22.275 $55.000 Balance Sheet (Millions of $) Assets Cash and securities Accounts receivable Inventories Total current assets Net plant and equipment Total assets Liabilities and Equity Accounts payable Notes payable Accruals Total current liabilities Long-term bonds Total debt Common stock Retained earnings Total common equity Total liabilities and equity $10,450 7,700 6.050 $24,200 $18.700 $42,900 $0 12.100 $12.100 $55,000 $12,100 Total common equity Total liabilities and equity $55,000 Income Statement (Millions of $). 2007 Net sales $99,000 Operating costs except 92,565 depreciation Depreciation 1,733 Earnings bef interest and taxes $4,703 (EBIT) Less interest 1,650 Earnings before taxes (EBT) $3,053 Taxes 1,068 Net income $1,984 Other data: Shares outstanding (millions) 500.00 Common dividends (millions of $694.44 $) Int rate on notes payable & L-T 6.25% bonds Federal plus state income tax rate 35% Year-end stock price $47.62 What is the firm's P/E ratio? a) 13.9 b) 12.0 ) O c) 13.2 Od) 14.6 e) 12.6