On January 1, 2014, Vahsholtz Corporation purchased 5,000 shares of treasury stock. Other information regarding Vahsholtz Corporation is provided.
|
2013 |
2014 |
|
|
Net income |
$100,000 |
$110,000 |
|
Dividends on preferred stock |
$30,000 |
$30,000 |
|
Dividends on common stock |
$20,000 |
$25,000 |
|
Weighted-average number of common shares outstanding |
50,000 |
45,000 |
|
Common stockholders” equity beginning of year |
$600,000 |
$750,000 |
|
Common stockholders” equity end of year |
$750,000 |
$830,000 |
Compute (a) return on common stockholders’ equity for each year and (b) earnings per share for each year, and (c) discuss the changes in each.