A Company Reports the Following Determine the a Rate Earned on Stockholders' Equity,and B Rate

question 172

Essay

A company reports the following:
$\begin{array}{|l|r|}\hline \text { Net income } & \$ 350,000 \\\hline \text { Preferred dividends } & 50,000 \\\hline \text { Average stockholders' equity } & 1,000,000 \\\hline \text { Average common stockholders' equity } & 800,000 \\\hline\end{array}$
Determine the a rate earned on stockholders' equity,and b rate earned on common stockholders' equity . Round to one decimal place.

---

Definitions:

Relative Frequency

The ratio of the number of times a particular event occurs to the total number of trials or instances.

Distribution

In logic, refers to the manner in which terms in propositions are applied to all of their potential subjects or only to some.

Total

The whole amount; the entirety of a particular number or quantity.

Ratio

A relationship between two numbers indicating how many times the first number contains the second or how the two numbers compare in size.