Comparative financial statements for Weller Corporation, a merchandising company, for the year ending December 31...
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Accounting
Comparative financial statements for Weller Corporation, a merchandising company, for the year ending December 31 appear below. The company did not issue any new common stock during the year. A total of 870,000 shares of common stock were outstanding. The interest rate on the bond payable was 12%, the income tax rate was 40%, and the dividend per share of common stock was $0.75 last year and $0.40 this year. The market value of the companys common stock at the end of this year was $21.50. All of the companys sales are on account.
Weller Corporation Comparative Balance Sheet (dollars in thousands)
This Year
Last Year
Assets
Current assets:
Cash
$
2,242
$
3,130
Accounts receivable, net
15,100
10,100
Inventory
10,050
8,480
Prepaid expenses
1,870
2,240
Total current assets
29,262
23,950
Property and equipment:
Land
6,700
6,700
Buildings and equipment, net
19,900
19,700
Total property and equipment
26,600
26,400
Total assets
$
55,862
$
50,350
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable
$
10,200
$
8,650
Accrued liabilities
740
1,050
Notes payable, short term
370
370
Total current liabilities
11,310
10,070
Long-term liabilities:
Bonds payable
7,500
7,500
Total liabilities
18,810
17,570
Stockholders' equity:
Common stock
870
870
Additional paid-in capital
4,550
4,550
Total paid-in capital
5,420
5,420
Retained earnings
31,632
27,360
Total stockholders' equity
37,052
32,780
Total liabilities and stockholders' equity
$
55,862
$
50,350
Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands)
This Year
Last Year
Sales
$
86,000
$
81,000
Cost of goods sold
55,500
51,500
Gross margin
30,500
29,500
Selling and administrative expenses:
Selling expenses
9,200
8,700
Administrative expenses
12,700
11,700
Total selling and administrative expenses
21,900
20,400
Net operating income
8,600
9,100
Interest expense
900
900
Net income before taxes
7,700
8,200
Income taxes
3,080
3,280
Net income
4,620
4,920
Dividends to common stockholders
348
696
Net income added to retained earnings
4,272
4,224
Beginning retained earnings
27,360
23,136
Ending retained earnings
$
31,632
$
27,360
Required:
Compute the following financial data for this year:
1. Earnings per share. (Round your answer to 2 decimal places.)
2. Price-earnings ratio. (Round your intermediate calculations and final answer to 2 decimal places.)
3. Dividend payout ratio. (Round your intermediate calculations and final answer to 2 decimal places.)
4. Dividend yield ratio. (Round your intermediate calculations and final answer to 2 decimal places.)
5. Book value per share. (Round your answer to 2 decimal places.)
Answer & Explanation
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