The following information is available Sales Net Income Reta

The following information is available: Sales Net Income Retained Earnings Avg. Stockholders\' Equity Dividends $ 400,000 $ 20,000 $ 40,000 $ 130,000 $ 6,000 What is the return on equity? (Round your answer to the nearest whole number.) Select one: O a. 5%. O b. 2096. O c.25%. d. 15%.

Solution

Answer is 15%

Return On Equity =Net Income/Avg Sharholder Equity

=20000/130000 =15%