The Calculation of Rate of Return on Common Shareholders' Equity $\frac{\text {Net Income - Dividends on Preferred Stock }}{\text {Ending Common Shareholders' Equity }}$

question 146

Multiple Choice

The calculation of Rate of Return on Common Shareholders' Equity (ROCE) is as follows: Rate of Return on Common = Shareholders' Equity

• A)\(\frac{\text {Net Income - Dividends on Preferred Stock }}{\text {Ending Common Shareholders' Equity }}\)
• B) \(\frac{\text { Net Income}}{\text { Average Common Shareholders' Equity}}\)
• C) \(\frac{\text { Net Income + Dividends on Preferred Stock}}{\text {Average Common Shareholders' Equity }}\)
• D)\(\frac{\text {Net Income - Dividends on Preferred Stock }}{\text {Average Common Shareholders' Equity }}\)
• E) \(\frac{\text {Net Income + Dividends on Preferred Stock }}{\text { Ending Common Shareholders' Equity}}\)

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