Holland Corporation's annual report is as follows. $$\begin{array} { | l | r | r | }
\hline & \text { March 31, 2017 } & \text { March 31, } 2018 \
\hline \text { Net Income } & \$ 350,000 & \$ 441,500 \
\hline \text { Preferred Dividends } & 0 & 0 \
\hline \text { Total Stockholders' Equity } & \$ 4,380,000 & \$5,092,000\
\hline \text { Stockholders' Equity attributable to Preferred } & 0 &0 \
\text { Stock } & \
\hline \text { Number of Common Shares Outstanding } & 284,000 & 195,000\
\hline
\end{array}$$ Based on the information provided, find the rate of return on common stockholders' equity on March 31, 2018. (Round your final answer two decimal places.)

Question

Holland Corporation's annual report is as follows. $$\begin{array} { | l | r | r | } 
\hline & \text { March 31, 2017 } & \text { March 31, } 2018 \
\hline \text { Net Income } & \$ 350,000 & \$ 441,500 \
\hline \text { Preferred Dividends } & 0 & 0 \
\hline \text { Total Stockholders' Equity } & \$ 4,380,000 & \$5,092,000\
\hline \text { Stockholders' Equity attributable to Preferred } & 0 &0 \
\text { Stock } &  \
\hline \text { Number of Common Shares Outstanding } & 284,000 & 195,000\
\hline
\end{array}$$ Based on the information provided, find the rate of return on common stockholders' equity on March 31, 2018. (Round your final answer two decimal places.)

Quizplus · Accepted Answer

The rate of return on common stockholders' equity is calculated as (Net Income - Preferred Dividends) / Average Common Stockholders' Equity. For 2018, it is ($441,500 - $0) / [($4,380,000 + $5,092,000) / 2] = 9.32%.

Holland Corporation's Annual Report Is as Follows Based on the Information Provided, Find the Rate of Return