(Answered) During 2014 the channel corporation and the dock

Accounting

During 2014 the Channel Corporation and the Dock Corporation reported net incomes of $90,000 and $130,000, respectively. Both companies had 25,000 shares of common stock issued and outstanding. The market price per share of Channel's stock was $47, while Dock's sold for $52 per share.

Required:

a. Determine the P/E ratio for each company.

b. Based on the P/E ratios computed in Requirement a, which company do investors believe has the greater potential for growth in income?

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