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Calculate the return on common share equity

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Problem - SW Company provides the Equity & Liability information below for analysis. SW Company had net income of $357,900 in 2020 and $315,200 in 2019.

Equity and Liabilities

2020

2019

Share capital-common (122,900 shares issued)

$1,215,000

$1,215,000

Retained earnings (Note 1)

390,100

263,200

Accrued liabilities

9,700

6,100

Notes payable (current)

82,000

58,500

Accounts payable

62,000

179,000

Total equity and liabilities

$1,758,800

$1,721,800

Note 1: Cash dividends were paid at the rate of $1 per share in 2019 and $2 per share in 2020.

Required - Calculate the return on common share equity for 2019 and 2020. (Assume total equity was $1,529,000 at December 31, 2018.)

Reference no: EM132770758

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