The following information is available from the balance sheets at the end of 2016 and 2015 for Riverside Company:
Net income for 2016 and 2015 was $340,000 and $300,000, respectively. Answer the following:
A Calculate the return on common stockholders' equity ratio for 2016.
B What information is provided to users with the calculation in part A? Explain.
C What is the difference between the return on stockholders' equity ratio and the return on assets ratio?
A Net income - Preferred dividends/Average common stockholders' equity = $340,000 - $0/[$1,69

Question

The following information is available from the balance sheets at the end of 2016 and 2015 for Riverside Company:
  Net income for 2016 and 2015 was $340,000 and $300,000, respectively. Answer the following:
A Calculate the return on common stockholders' equity ratio for 2016.
B What information is provided to users with the calculation in part A? Explain.
C What is the difference between the return on stockholders' equity ratio and the return on assets ratio?
A Net income - Preferred dividends/Average common stockholders' equity = $340,000 - $0/[$1,69

Quizplus · Accepted Answer

The Answer of The following information is available from the balance sheets at the end of 2016 and 2015 for Riverside Company:
  Net income for 2016 and 2015 was $340,000 and $300,000, respectively. Answer the following:
A Calculate the return on common stockholders' equity ratio for 2016.
B What information is provided to users with the calculation in part A? Explain.
C What is the difference between the return on stockholders' equity ratio and the return on assets ratio?
A Net income - Preferred dividends/Average common stockholders' equity = $340,000 - $0/[$1,69

The Following Information Is Available from the Balance Sheets at the End