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Edelman Engines has $13 billion in total assets. Its balance sheet shows $2.6 billion in current...

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Finance

Edelman Engines has $13 billion in total assets. Its balancesheet shows $2.6 billion in current liabilities, $9.1 billion inlong-term debt, and $1.3 billion in common equity. It has 400million shares of common stock outstanding, and its stock price is$34 per share. What is Edelman's market/book ratio? Round youranswer to two decimal places.

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Information provided:

Total assets= $13 billion

Current assets= $2.6 billion

Long term debt= $9.1 billion

Common equity= $1.3 billion

Shares outstanding= 400 million shares

Stock price= $34 per share

Book value per share = Book value of equity/ Shares outstanding

                                          = $1,300,000,000/ 400,000,000

                                          = $3.25

Market to book ratio= Market value per share/ Book value per share

                                        = $34/ $3.25

                                        = 10.46.

In case of any query, kindly comment on the solution.
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Transcribed Image Text

Edelman Engines has $13 billion in total assets. Its balancesheet shows $2.6 billion in current liabilities, $9.1 billion inlong-term debt, and $1.3 billion in common equity. It has 400million shares of common stock outstanding, and its stock price is$34 per share. What is Edelman's market/book ratio? Round youranswer to two decimal places.

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