A company with a net income of $2,800,000 has 400,000 weighted average common shares. The price-earnings ratio is 20.What is the market value per...

The company's net income is $2,800,000. There are 400,000
weighted average common shares. The price to earnings ratio is
20.

First, let's find the income per share or EPS. That is
the total net income earned by the company divided by the total number of shares. Using
the information given it can be calculated as 2,800,000/400,000 =
$7.

The P/E or price to earnings ratio is 20. This gives
the market value of a share of the company as 20 times the net income per
share.

For a net income per share of $7, the market value
is equal to 20*7 = $140.

The correct option for the market
value of the stock of the company is option B.