Which of the Following Describes the Return on Equity Ratio

question 34

Multiple Choice

Which of the following describes the return on equity ratio?

• A)[Net income + interest expense × 1 - tax rate))] ÷ average common shareholders' equity
• B)[Net income - preferred shares] ÷ average common shareholders' equity
• C)[Net income + preferred dividends] ÷ common shareholders' equity
• D)[Net income - preferred dividends] ÷ average common shareholders' equity

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