Ferman Corporation Had Net Income of $160,000 and Paid Dividends

question 45

Multiple Choice

Ferman Corporation had net income of $160,000 and paid dividends of $50,000 to common stockholders and $20,000 to preferred stockholders in 2014. Ferman Corporation's common stockholders' equity at the beginning and end of 2014 was $870,000 and $1,130,000, respectively. Ferman Corporation's return on common stockholders' equity was

• A) 16%.
• B) 14%.
• C) 11%.
• D) 9%.