9. Which of the following is the return on equity for Eastern Corporation? A) 35

Question

9. Which of the following is the return on equity for Eastern Corporation? A) 35.9% B) 33.4% C) 30.3% D) 35.2% 10. A corporation has net income of $365,000 for the current year. It paid its required preferres dividend of $17,500 and had no other stock transactions during the year. The average number o common shares issued during the year was 69,500. The corporation also held 10,000 shares of it common stock as treasury stock for the entire year. What is earnings per share? A) Earnings per share is $5.84 B) Earnings per share is $1.00 C) Earnings per share is $4.37 D) Earnings per share is $5.00

Explanation / Answer

9. You have not given any information. So here I am giving you the formula:

(Net income - preferred dividends) / Average common stockholders' equity

10. Ans: D

Explanation:

365000-17500 = 347000/69500 = Earnings per share is $5.00

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