Question

Weygandt, Accounting Principles, 13e Help System Announcements Exercise 14-16 This financial information is available for Cullumber Corporation. 2020 2019 Average common stockholders' equity Dividends paid to common stockholders Dividends paid to preferred stockholders Net income Market price of common stock $1,770,000 95,000 18,500 286,500 19 $2,100,000 65,500 18,500 245,000 23 The weighted average number of shares of common stock outstanding was 176,000 for 2 Calculate earnings per share and return on common stockholders' equity for 2020 and 20 2020 2019 Earnings per share Return on common stockholders' equity 33 % Click if you would like to Show Work for this question: Open Show Work By accessing this Question Assistance, you will learn while you earn points based on the Po

Answer 1

Solution:

Particulars	2020	2019
Earnings Per Share	$ 1.52	$ 1.29
Return on common stockholders` equity	15.14%	10.79%

Notes:

1)

Particulars	2020	2019	Calculation
Earnings Per Share
Net Income	$          286,500	$           245,000	Given
Less: Preferred Dividend	$          (18,500)	$           (18,500)	Given
Earnings (a)	$          268,000	$           226,500
Weighted Average Common Stock (b)	$          176,000	$           176,000	Given
Earnings Per Share (a / b )	$                 1.52	$                  1.29

2)

Particulars	2020	2019	Calculation
Earnings Per Share
Net Income	$          286,500	$           245,000	Given
Less: Preferred Dividend	$          (18,500)	$           (18,500)	Given
Earnings (a)	$          268,000	$           226,500
Average Common Stockholders` Equity (b)	$       1,770,000	$       2,100,000	Given
Return on common stockholders` equity (a / b)	15.14%	10.79%