B. For the year 200B - Lim Company's return on common stockholders' equituy was 12.5 %.

Its average stockholders' equity for the same period was 500,000 ,
inclusive of 50,000 par value preferred stock with a dividend rate of 8% .

How much was the company's net income for 200B ?

SOLUTION:
Return on Equity = Net Income
Ave. Stockholders Equity
12.5%= Net Income
450,000.00 P 500,000.00- 50,000.00(preferred stock)
Net Income= (0.125)(45,000.00)
Net Income= P 58,250.00