Evans & Sons, Inc., disclosed the following information in a recent annual report: Previous Year Current Year $94,500 $129,600 1,000,000 1,500,000 Net Income Average stockholders' equity Dividend per common share Earnings per share Market price per common share, year-end Previous Year $ Current Year $ 5.13 7.70 51.30 Calculate the return on equity for Evans & Sons for each year. Did the return improve? Numerator Denominator Did the return improve? The return on common stockholders' equity 0 5.40 8.64 56.70 0 ◆ 0 0 ◆ from the previous year to the current year. ROE % %
Evans & Sons, Inc., disclosed the following information in a recent annual report: Previous Year Current Year $94,500 $129,600 1,000,000 1,500,000 Net Income Average stockholders' equity Dividend per common share Earnings per share Market price per common share, year-end Previous Year $ Current Year $ 5.13 7.70 51.30 Calculate the return on equity for Evans & Sons for each year. Did the return improve? Numerator Denominator Did the return improve? The return on common stockholders' equity 0 5.40 8.64 56.70 0 ◆ 0 0 ◆ from the previous year to the current year. ROE % %
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![**Return on Equity**
Evans & Sons, Inc., disclosed the following information in a recent annual report:
| | Previous Year | Current Year |
|-------------------------------------|---------------|--------------|
| Net Income | $94,500 | $129,600 |
| Average stockholders' equity | 1,000,000 | 1,500,000 |
| Dividend per common share | 5.13 | 5.40 |
| Earnings per share | 7.70 | 8.64 |
| Market price per common share, year-end | 51.30 | 56.70 |
Calculate the return on equity for Evans & Sons for each year. Did the return improve?
**Table for Calculation:**
| | Numerator | Denominator | ROE |
|-----------------|-----------|-------------|-----|
| Previous Year | $ | $ | % |
| Current Year | $ | $ | % |
**Did the return improve?**
The return on common stockholders' equity [dropdown] from the previous year to the current year.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff1ac4a5c-5c91-4743-9545-fc03c7695e62%2Fcdb4687d-9250-4390-ab6d-c79b6a1ff2f2%2Fzgh4l2v_processed.png&w=3840&q=75)
Transcribed Image Text:**Return on Equity**
Evans & Sons, Inc., disclosed the following information in a recent annual report:
| | Previous Year | Current Year |
|-------------------------------------|---------------|--------------|
| Net Income | $94,500 | $129,600 |
| Average stockholders' equity | 1,000,000 | 1,500,000 |
| Dividend per common share | 5.13 | 5.40 |
| Earnings per share | 7.70 | 8.64 |
| Market price per common share, year-end | 51.30 | 56.70 |
Calculate the return on equity for Evans & Sons for each year. Did the return improve?
**Table for Calculation:**
| | Numerator | Denominator | ROE |
|-----------------|-----------|-------------|-----|
| Previous Year | $ | $ | % |
| Current Year | $ | $ | % |
**Did the return improve?**
The return on common stockholders' equity [dropdown] from the previous year to the current year.
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