Leonhardt Corporation's Net Income Last Year Was $3,800,000

Multiple Choice

Leonhardt Corporation's net income last year was $3,800,000. The dividend on common stock was $2.00 per share and the dividend on preferred stock was $1.80 per share. The market price of common stock at the end of the year was $53.40 per share. Throughout the year, 500,000 shares of common stock and 100,000 shares of preferred stock were outstanding. The price-earnings ratio is closest to:

A) 9.54
B) 7.03
C) 7.38
D) 10.19