Calculating return on equity (Learning Objective 8) 10–15 min.

Assume that Hanson Industrial Supply, Inc., has the following data:

Net income for 2014 ........................................................................................

Preferred dividends for 2014 ...........................................................................

Total stockholders’ equity, 12/31/2014............................................................

Total stockholders’ equity, 12/31/2013............................................................

Common stockholders’ equity, 12/31/2014 .....................................................

Common stockholders’ equity, 12/31/2013 .....................................................

$ 251,875

$ 5,875

$1,750,000

$1,500,000

$1,590,000

$1,410,000 Requirements 1. Calculate Hanson Industrial Supply’s return on equity for 2014.

2. Comment on Hanson Industrial Supply’s performance during 2014.

AppendixLO1