Kong Inc Reported Net Income of $298,000 During 2018 and Paid

question 235

Multiple Choice

Kong Inc. reported net income of $298,000 during 2018 and paid dividends of $26,000 on common stock. It also has 10,000 shares of 6%, $100 par value cumulative preferred stock outstanding. Common stockholders' equity was $1,200,000 on January 1, 2018, and $1,600,000 on December 31, 2018. The company's return on common stockholders' equity for 2018 is:

• A) 17.4%
• B) 17.0%
• C) 15.1%
• D) 21.3%