Common stockholders’ profitability analysis Obj. 5 A company reports the following:

Net income $ 375,000 Preferred dividends 75,000 Average stockholders’ equity 2,500,000 Average common stockholders’ equity 1,875,000 Determine

(a) the return on stockholders’ equity and

(b) the return on common stockholders’

equity. Round to one decimal place.

AppendixLO1