Answer:
26.19%
Step-by-step explanation:
The computation of rate of return on common stockholders' equity is shown below:-
Total = Stockholder's equity at the beginning of the year + Stockholder's equity at the end of the year
= $1,900,000 + $2,300,000
= $4,200,000
Average stockholder's equity = Total ÷ 2
= $4,200,000 ÷ 2
= $2,100,000
Rate of return on common stockholder's equity = Net income for the common stockholders ÷ Average common stockholder's equity
= $550,000 ÷ $2,100,000
= 26.19%