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19 March, 21:42

Winston Watch's stock price is $70 per share. Winston has $10 billion in total assets. Its balance sheet shows $1 billion in current liabilities, $3 billion in long-term debt, and $6 billion in common equity. It has 400 million shares of common stock outstanding. What is Winston's market/book ratio? Do not round intermediate calculations. Round your answer to two decimal places.

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  1. 19 March, 22:04
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    The Market/book ratio is 5.67.

    Explanation:

    Book value per share = (common equity) / (number of shares)

    = ($ 6 billion) / ($ 400million)

    = $ 15 per share

    Market/book ratio = (market price per share) / (book value per share

    = $75/$15

    = 5.00

    Therefore, the Market/book ratio is 5.67.
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Home » Business » Winston Watch's stock price is $70 per share. Winston has $10 billion in total assets. Its balance sheet shows $1 billion in current liabilities, $3 billion in long-term debt, and $6 billion in common equity.
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