Farmer Company reports the following amounts for 2013:

Net income	$135,000
Average stockholders' equity	500,000
Preferred dividends	35,000
Par value preferred stock	100,000

The 2013 rate of return on common stockholders' equity is

25.0%.

22.5%.

27.0%.

33.8%.

Crain Company issued 2,000 shares of its $5 par value common stock in payment of its attorney's bill of $40,000. The bill was for services performed in helping the company incorporate. Crain should record this transaction by debiting

Legal Expense for $10,000.

Legal Expense for $40,000.

Organization Expense for $10,000.

Organization Expense for $40,000.