Nicco Corporation Had the Following Accounts at January 1, 2013

Essay

Nicco Corporation had the following accounts at January 1, 2013:
common shares, unlimited number of shares authorized, 18,000 shares issued, $180,000;
preferred shares, $4 cumulative, unlimited number of shares authorized, 1,000 shares issued, $50,000;
retained earnings, $223,000.
The company has profit of $79,000 in 2013 and paid $85,000 in dividends.
Instructions
a. Calculate the return on equity at December 31, 2013.
b. What does this ratio tell you about the corporation?