Sealy Corporation had the following information in its financial statements for the years ended 2014 and 2015: Cash dividends for the year 2015 $ 5,000 Net income for the year ended 2015 87,000 Market price of stock, 12/31/14 10 Market price of stock, 12/31/15 12 Common stockholders’ equity, 12/31/14 1,000,000 Common stockholders’ equity, 12/31/15 1,200,000 Outstanding shares, 12/31/15 100,000 Preferred dividends for the year ended 2015 15,000 What is the rate of return on common stock equity for Sealy Corporation for the year ended 2015?
Sealy Corporation had the following information in its financial statements for the years ended 2014 and 2015:
Cash dividends for the year 2015 $ 5,000
Net income for the year ended 2015 87,000
Market price of stock, 12/31/14 10
Market price of stock, 12/31/15 12
Common
Common stockholders’ equity, 12/31/15 1,200,000
Outstanding shares, 12/31/15 100,000
Preferred dividends for the year ended 2015 15,000
What is the
a. 7.9%
b. 6.4%
c. 7.0%
d. 6.5%
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