1. Katie Inc reported net income of $186,000 for the current year and paid dividends of 26,000 on common stock. It also has 10,000 shares of 6 percent , $100 per value, noncumulative preferred stock outstanding. common stockholders' equity was $1,200,000 on january 1 and $1,600,000 on December 31. The company's return on common stockholders' equity for the current year is

a. 13.3 %

b. 10.0%

c. 9.0%

d. 7.1%

2. earning per share (eps) indicate the net income earned by each share of issued common stock

a. True

B. false

3. The income statement for nadeen, INC.. shows before income taxes $700,000, Income tax expense $210,000 and net income $490,000.If Nadeen has 10,000 shares if common stock outstanding throughout the year, earnings per share is

a. $7.00

B. $4.90

c.$2.10

D,. None of the above

4. A declaration of dividends is a requirement for a cash divdend to occur

for cash dividend to occur, a corporation must have all of the following except

a. retained earnings

b. a declartion of divdends

c, net income

d. adequate cash

5. when a corporATION HAS preferred and common stock outstanding, earnings per share is computed by dividing net income

a. by weighting-average common shares oustanding.

b. less preferred dividends by weighted-average common shares outstanding.

c.by ending common shares outstanding.

d. less preferred divdends by ending common shares outstanding.