rate earned on common stockholders'equity Definition | Business Dictionaries from AllBusiness.com
Facebook Twitter Google+ You Tube RSS Feed
data-override-format="true" data-page-url = "http://www.allbusiness.com">

Business Glossary

SEARCH THE BUSINESS GLOSSARY

Business Definition for: rate earned on common stockholders'equity
rate earned on common stockholders'equity

ratio indicating the earnings on the common stockholders' investment. It equals net income minus preferred dividends divided by average common stockholders' equity. Assume net income of $50,000, preferred dividends of $10,000, and average common stockholders' equity of $200,000. The ratio is 20% ($40,000/$200,000).

Copyright © 2005, 2000, 1995, 1987 by Barron's Educational Series, Inc., Reprinted by arrangement with Publisher.

Newsletter

Weekly Roundup

Sign up for our weekly Experts roundup, delivered to your inbox each Saturday morning.

Most Recent From our Experts

AllBusiness Experts

AllBusiness Greatest Hits

;
Close

Real Business Owners, Real Business Advice!

Sign up for practical, real-world solutions from successful business owners delivered to your inbox each Saturday morning. FREE.