From the following corporate information, compute the return on common stockholders’ equity.Average common stock equity$100,000Net income50,000Preferred stock dividends10,000Number of common shares20,000

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Exam content for CLEP Financial Accounting exam, which covers the basics of introductory financial accounting course: General Topics (20%–30%) Generally accepted accounting principles Rules of double-entry accounting/transaction analysis/accounting equation The accounting cycle Business ethics Purpose of, presentation of, and relationships between financial statements Forms of business The Income Statement (20%–30%) Presentation format issues Recognition of revenue and expenses Cost of goods sold Irregular items (e.g., discontinued operations, extraordinary items,... Show more

From the following corporate information, compute the return on common stockholders’ equity.<table class='none'><col width='55.37%' class='calibre5' width='400px' /><col width='23.97%' class='calibre5' width='400px' /><tr class='calibre6'><td class='filet_x4'>Average common stock equity</td><td class='filet_x5'>$100,000</td></tr><tr class='calibre6'><td class='filet_x4'>Net income</td><td class='filet_x5'>50,000</td></tr><tr class='calibre6'><td class='filet_x4'>Preferred stock dividends</td><td class='filet_x5'>10,000</td></tr><tr class='calibre6'><td class='filet_x4'>Number of common shares</td><td class='filet_x5'>20,000</td></tr></table><br>