4b

The following information is available for Norman Corporation

2021 2020

Average common stockholders equity $1,500,000 $1,000,000

Average total stockholders equity 2,000,000 1,500,000

Common dividends declared and paid 72,000 50,000

Preferred dividends declared and paid 30,000 30,000

Net income 300,000 250,000

Instructions

Compute the payout ratio and return on common stockholders equity ratio for both years. Briefly comment on your findings.