I am providing the solution to a homework assignment that I am confused about ho

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I am providing the solution to a homework assignment that I am confused about how the solution is what it is. Please see part c of this question and the provided solution. My professor is saying that 2.6 is the total asset turnover ratio, but when I put in the numbers for that formula, I do not come up with 2.6. Can someone please provide a step-by-step guide to question 10c please so that I can understand how the solution is what it is. I've asked my professor in several emails, but to no avail. Thanks for anyone who can help!!

c. If the market value of a share of common stock is 3.3 times book value for 20X1, what is the firm’s P/E ratio for 20X2 vs. 20X1? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)

Refer to the following financial statements for Crosby CROSBY CORPORATION Income Statement For the Year Ended December 31, 20X2 7 expense Earnings available to common stockholders Statement of Retained Earnings For the Year Ended December 31, 20X2 Retained earnings, balance, January 1, 20X2 $ 889,100 Add: Earnings available to common stockholders, 20X2 Deduct: Cash dividends declared and paid in 20X2 148,000 $ 925,800 Retained earnings, balance, December 31, 20X2 Comparative Balance Sheets For 20X1 and 20X2 Year-End 20X1 2,640,000 1,510,000 3,250,000 2,692,900 S 2,925,600 019,800 Preferred stock, $100 par value 1,515,800 S 2,925,800 2,692,900

Explanation / Answer

the question states thar market value is 3.3 times the book value

Explanation:
a.The increase in cash flows must equal the difference in the cash account from the beginning of the period tothe end of the period.
b.Book value per share = (Stockholders' equity ?Preferred stock) / Common shares outstanding
Book value per share20X1= ($1,479,100 ?90,000) / 150,000= $9.26
Book value per share20X2= ($1,515,800 ?90,000) / 150,000= $9.51
c.Market value= 3.3 ×$9.51 = $31.38
P/E ratio= Market value / Earnings per share= $31.38 / $1.23= 25.51 times

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