Sheffield Corp. had net income of $163625 and paid dividends of $48500 to common stockholders and...

Sheffield Corp. had net income of $163625 and paid dividends of $48500 to common stockholders and $16500 to preferred stockholders in 2020. Sheffield Corp.’s common stockholders’ equity at the beginning and end of 2020 was $890000 and $1250000, respectively. Sheffield Corp.’s return on common stockholders’ equity was

13.75%.

10.75%.

9.75%.

15.75%.

Solutions

Expert Solution

Correct Option A i.e. 13.75%

Return on Equity = Net Income to common stockholder/ Average Equity
= 147125 / 1070000
13.75%


Net Income to common stockholder

Net Income	163,625
Less: Dividend to preference stockholder	(16,500)

Net Income to common stockholder	147,125


Average Equity =( Beginning Equity + Ending Equity )/2
=(890000 + 1250000)/2
1,070,000

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

Wildhorse Co. had net income of $175240 and paid dividends of $40000 to common stockholders and...

Wildhorse Co. had net income of $175240 and paid dividends of $40000 to common stockholders and $19000 to preferred stockholders in 2020. Wildhorse Co.’s common stockholders’ equity at the beginning and end of 2020 was $862000 and $1370000, respectively. Wildhorse Co.’s return on common stockholders’ equity was 11.00%. 14.00%. 10.00%. 16.00%.

8 A firm paid total cash dividends of $119 and had net income of $217 in...

8 A firm paid total cash dividends of $119 and had net income of $217 in 2008. If it earned $328 in 2009 and maintained the same dividend payout ratio that it paid in this year, what will the firm's total dividends be? Please round to two decimals

Problem 11-8A (Part Level Submission) On January 1, 2017, Sheffield Corp. had these stockholders’ equity accounts....

Problem 11-8A (Part Level Submission) On January 1, 2017, Sheffield Corp. had these stockholders’ equity accounts. Common Stock ($10 par value, 84,000 shares issued and outstanding) $840,000 Paid-in Capital in Excess of Par Value 505,500 Retained Earnings 610,000 During the year, the following transactions occurred. Jan. 15 Declared a $0.60 cash dividend per share to stockholders of record on January 31, payable February 15. Feb. 15 Paid the dividend declared in January. Apr. 15 Declared a 10% stock dividend to...

Sheffield Corp. purchased a machine on July 1, 2020, for $30,975. Sheffield paid $210 in title...

Sheffield Corp. purchased a machine on July 1, 2020, for $30,975. Sheffield paid $210 in title fees and a legal fee of $175 related to the machine. In addition, Sheffield paid $590 in shipping charges for delivery, and $450 to a local contractor to build and wire a platform for the machine on the plant floor. The machine has an estimated useful life of 10 years, a total expected life of 12 years, a residual value of $6,300, and no...

True/ False questions 1) Dividends paid to stockholders are tax deductible on a corporations income Statement....

True/ False questions 1) Dividends paid to stockholders are tax deductible on a corporations income Statement. 2) Common stock in a corporation can be privately owned by private investors or publicly owned by public investors. 3) the number of outstanding shares of common stock is always greater than or equal to the number of authorized shares of common stock 4) Typically small corporations are publicly owned large corporations are privately or closely owned.

Sheffield Corp. has 149,910 shares of common stock outstanding. In 2020, the company reports income from...

Sheffield Corp. has 149,910 shares of common stock outstanding. In 2020, the company reports income from continuing operations before income tax of $1,221,100. Additional transactions not considered in the $1,221,100 are as follows. 1. In 2020, Sheffield Corp. sold equipment for $36,200. The machine had originally cost $81,900 and had accumulated depreciation of $34,800. The gain or loss is considered non-recurring. 2. The company discontinued operations of one of its subsidiaries during the current year at a loss of $196,200...

Net income for the year was $117,000. Dividends of $114,000 cash were declared and paid. Scoreteck’s...

Net income for the year was $117,000. Dividends of $114,000 cash were declared and paid. Scoreteck’s only noncash expense was $87,000 of depreciation. The company purchased plant assets for $87,000 cash. Notes payable of $37,000 were issued for $37,000 cash. Complete the following spreadsheet in preparation of the statement of cash flows. (The statement of cash flows is not required.) Report operating activities under the indirect method. (Enter all amounts as positive values.) SCORETECK CORPORATION Spreadsheet for Statement of...

Assume that in 2017, The Shallonz Corporation reported net income of $143 million, and paid dividends...

Assume that in 2017, The Shallonz Corporation reported net income of $143 million, and paid dividends totaling $36.5 million throughout the year. Their net income has been growing at about 5% per year for some time, but it is expected to grow by 20% in 2018. Growth is expected to return to the normal 5% the following year and thereafter. It has also been estimated that the company will need about $52 million in funds for capital expenditures in 2018....

Sheffield Corp. issued 100000 shares of $10 par common stock for $1340000. A year later Sheffield...

Sheffield Corp. issued 100000 shares of $10 par common stock for $1340000. A year later Sheffield acquired 16100 shares of its own common stock at $15 per share. Three months later Sheffield sold 8200 of these shares at $19 per share. If the cost method is used to record treasury stock transactions, to record the sale of the 8200 treasury shares, Sheffield should credit

Preferred stockholders have a priority over common stockholders as to dividends only. assets in the event...

Preferred stockholders have a priority over common stockholders as to dividends only. assets in the event of liquidation only. voting rights. both dividends and assets in the event of liquidation.

Subjects