Katie Inc. reported net income of $186,000 during

2019 and paid dividends of $26,000 on common

stock. It also has 10,000 shares of 6%, $100 par value,

noncumulative preferred stock outstanding and paid

dividends of $60,000 on preferred stock. Common

stockholders’ equity was $1,200,000 on January 1,

2019, and $1,600,000 on December 31, 2019. The

company’s return on common stockholders’ equity

for 2019 is:

(a) 10.0%.

(b) 9.0%.

(c) 7.1%.

(d) 13.3%.