FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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**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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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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