1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
kifflom [539]
3 years ago
9

The return on common stockholders’ equity is computed by dividing a) net income less preferred dividends by ending common stockh

olders’ equity. b) net income less preferred dividends by average common stockholders’ equity. c) net income by ending common stockholders’ equity. d) net income by average common stockholders’ equity.
Business
1 answer:
gulaghasi [49]3 years ago
5 0

Answer:

b) net income less preferred dividends by average common stockholders’ equity

Explanation:

Common stock dividends in a company is paid to stockholders after preferred dividends have been removed.

Preference shares are issued to investors with an agreement that they will recieve dividends before other shareholders.

So when calculating return on common stockholder's equity we will first deduct dividend paid to preference share holders.

The income coming to common share holders is now divided by average common stockholders equity to get the return on common stock equity.

Return on equity is usually used as a measure of how efficiently management uses company's assets to generate profits.

You might be interested in
On November 1, 2017, Blue Company borrowed from Yellow Bank and received a 9-month note for $60,000 at a 5% interest rate. Inter
frutty [35]

Answer:

In the books of Blue Company:

November 1, 2017:

Debit Cash                                           $60,000

Credit Note payable                            $60,000

<em>(To record borrowed note from Yellow Bank)</em>

December 31, 2017:

Debit Interest expense                            $500

Credit Interest payable                            $500

<em>(Interest expense recognition on note for 2 months)</em>

August 1, 2018:

Debit Note payable                             $60,000

Debit Interest payable                           $2,250

Credit Cash                                          $62,250

<em>(To record settlement of note at maturity)</em>

In the books of  Yellow Bank:

November 1, 2017:

Debit Note receivable                        $60,000

Credit Cash                                         $60,000

<em>(To record note receivable from Blue Company)</em>

December 31, 2017:

Debit Interest receivable                        $500

Credit Interest revenue                           $500

<em>(Interest revenue recognition on note for 2 months)</em>

August 1, 2018:

Debit Cash                                         $62,250

Credit Note receivable                     $60,000

Credit Interest receivable                   $2,250

<em>(To record note collection at maturity)</em>

Explanation:

Note receivable is a promissory note with a written promise made by the borrower to the lender (payee) to pay a certain, definite sum at a specified date.

Interest expense / revenue on the notes is calculated as: Principal x Interest Rate x Time

In this case, the total interest expense / revenue is $60,000 x 5%/12 x 9 months = $2,250.

Monthly interest expense / revenue is therefore $2,250 / 9 months = $250.

Therefore, interest expense / revenue recognition for 2 months will be $250 x 2 months (November 1 - December 31) = $500.

8 0
3 years ago
To create strong partnering relationships, marketing channel members must develop mutual trust, openly communicate, have common
Mariulka [41]

It is important that members of marketing channel develop the willingness to invest in each other's success to create strong partnering relationships.

<h3>Who are members of marketing channel?</h3>

In a marketing channel, these member are the individuals that help the producer to channel their products to consumers.

The members of marketing channel includes a wholesales, retailers, agent etc.

In conclusion, these member must always be willing to invest in each other's success to create strong partnering relationships.

Read more about marketing channel

<em>brainly.com/question/25339343</em>

6 0
2 years ago
When workers use technology to work from home or an office center, they are _____.
xz_007 [3.2K]

Your answer is <span>telecommuting or B.</span>
6 0
3 years ago
Read 2 more answers
What instrument did the piano originate from
NNADVOKAT [17]

Answer:

stringed musical instrument

Explanation:

The piano is an acoustic, stringed musical instrument invented in Italy by Bartolomeo Cristofori around the year 1700 (the exact year is uncertain), in which the strings are struck by hammers.

4 0
4 years ago
Read 2 more answers
Erin bought stock with company XYZ, deposited money in a CD account, and started investing on a regular basis in a mutual fund.
faust18 [17]

It is true that Erin has a diversified portfolio as he invest in different investment.

<h3>What is a Portfolio diversification?</h3>

This refers to investing of funds in different asset classes and securities in an attempt to minimize the risk of a portfolio.

Hence, It is true & yes that Erin has a diversified portfolio as he invest in different investment.

Read more about diversification

<em>brainly.com/question/417234</em>

#SPJ1

5 0
2 years ago
Other questions:
  • Precision Engineering recently announced that its next annual dividend will be $1.20 per share with later dividends increasing b
    14·1 answer
  • Bradford Services Inc. (BSI) is considering a project that has a cost of $10 million and an expected life of 3 years. There is a
    14·1 answer
  • In modern corporations—especially those in the United States and the United Kingdom—a primary objective of corporate governance
    11·1 answer
  • When estimating the cost of equity by use of the CAPM, three potential problems are (1) whether to use long-term or short-term r
    5·1 answer
  • Retired utility workers are suing their former employer for knowingly exposing them to asbestos without warning them of the heal
    5·1 answer
  • Last year Thomson Inc's earnings per share were $3.50, and its growth rate during the prior 5 years was 11.0% per year. If that
    15·1 answer
  • The Financial Accounting Standards Board has the authority to develop generally accepted accounting principles. Choose the optio
    13·1 answer
  • Local adaptation is typically preferred by managers who are charged with making the international business successful in their c
    10·1 answer
  • What analysis feature of a decision support system (DSS) pinpoints the region that generated the highest total sales
    11·1 answer
  • Consider the economies of Sporon and Gribinez, both of which produce agricultural products using only land and labor. The follow
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!