O'Connors,Inc $\begin{array}{ll}\text { Net income } & \$ 180,000 \\\text { Market price per share of common stock } & \$ 20,00 / \text { share }\end{array}$

question 102

Essay

O'Connors,Inc.provides the following information for 2018:
$\begin{array}{ll}\text { Net income } & \$ 180,000 \\\text { Market price per share of common stock } & \$ 20,00 / \text { share }\end{array}$
$\begin{array}{ll}\text { Common stockholders' equity at Jan. } 1,2018 & \$ 1,100,000 \\\text { Common stockholders' equity at Dec. } 31,2018 & \$ 1,500,000 \\12 \% \text { preferred stock outstanding } & \$ 100,000\end{array}$
Calculate the return on common stockholders' equity.(Round to two decimals.)

---

Definitions:

Net Profit Margin

A financial performance metric that shows the percentage of sales that has turned into profits, calculated by dividing net profit by revenue.

Price/Earnings Ratio

A valuation ratio of a company's current share price compared to its per-share earnings, used to evaluate a company's financial health and growth prospects.

Quick Ratio

A liquidity indicator that evaluates a company's ability to pay its current liabilities without relying on the sale of inventory, calculated as (current assets - inventory) / current liabilities.