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Please clearly show step-by-step calculations and logic and technique applied in arriving at answer. ...

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Accounting

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Please clearly show step-by-step calculations and logic and technique applied in arriving at answer.

18. Price-earnings ratio (LO2-2) Botox Facial Care had earnings after taxes of $370,000 in 20X1 with 200,000 shares of stock outstanding. The stock price was $31.50. In 20X2, earnings after taxes increased to $436,000 with the same 200,000 shares outstanding. The stock price was $42.00 a. Compute earnings per share and the P/E ratio for 20X1. The P/E ratio equals the stock price divided by earnings per share. b. Compute earnings per share and the P/E ratio for 20X2. Give a general explanation of why the P/E ratio changed. C

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