The net income of a company for the year was $500,000. The company has no preferred stock. Common stockholders' equity was $1,200,000 at the beginning of the year and $2,300,000 at the end of the year. Calculate the rate of return on common stockholders' equity. (Round your answer to two decimal places.)
A) 21.74%
B) 17.86%
C) 41.67%
D) 28.57%
D) 28.57%
Rate of return on common stockholders' equity = (Net Income - Preferred dividend) /
Average common stockholders' equity = $500,000 / [($1,200,000 + $2,300,000) / 2] = $500,000 /
1,750,000 = 28.57%
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Calculate the total sales of a product if the market demand for the product now in the early growth stage of the product life cycle is 2 million units annually, and the product captures 15 percent of this demand with a price of $50 per unit
A) $100 million B) $15 million C) $30 million D) $50 million E) $75 million
Which of the following can increase a company's return on investment?
A) decrease in operating income B) decrease in total assets C) decrease in asset turnover ratio D) decrease in residual income
During the year, Todd Corporation issued 200 shares of $20 par value common stock for $50 a share. A total of 500 shares were authorized. In addition, the company purchased 75 shares of treasury stock at $44 a share. Which of the following best presents the related lines in the stockholders' equity section of the company's balance sheet?
A.
| Common stock, $20 par value, 500 shares authorized, 200 shares issued, 425 outstanding | $ | 8,500 | |
| Paid in capital in excess of par - Common | 11,050 | ||
| Less: Treasury stock, 75 shares @ $44 per share | (3,300 | ) |
B.
| Common stock, $20 par value, 500 shares authorized, 200 shares issued, 125 outstanding | $ | 4,000 | |
| Paid in capital in excess of par - Common | 6,000 | ||
| Less: Treasury stock, 75 shares @ $44 per share | (3,300 | ) |
C.
| Common stock, $50 market value, 500 shares authorized, 200 shares issued, 125 outstanding | $ | 10,000 | |
| Less: Treasury stock, 75 shares @ $44 per share | (3,300 | ) |
D.
| Common stock, $20 par value, 500 shares authorized, 200 shares issued and outstanding | $ | 4,000 | |
| Paid in capital in excess of par - Common | 6,000 | ||
| Less: Treasury stock, 75 shares @ $20 per share | (1,800 | ) |
Define orientation. Why is it considered important for new employees?
What will be an ideal response?