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4 points eBook Exercise 16-5 (Algo) Financial Ratios for Assessing Profitability [LO16-5] 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 910,000 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 company's common stock at the end of this year was $24. All of the company's sales are on account. Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year Hint Assets Print References Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Property and equipment: Buildings and equipment, net Land Total property and equipment Total assets $ 1,506 $1,720 15,500 10,300 10,250 1,910 29,166 8,640 2,320 23,900 7,100 7,100 20,300 20,100 27,400 27,200 $ 56,566 $ 50,180 Liabilities and Stockholders' Equity Current liabilities:) Accounts payable Accrued liabilities Notes payable, short term Total current liabilities Long-term 11abilities: Bonds payable Total liabilities Stockholders equity: Common stock Additional paid-in capital Total paid-in capital $ 10,600 820 410 $8,850 1,250 410 11,830 10,510 6,250 6,250 18,000 16,700 910 910 4,750 4.750 5,660 5,660 Retained earnings 33,826 27,760 Total stockholders' equity 38,486 33,420 Total liabilities and stockholders' equity. $ 56,566 $50,100 7 Total stockholders' equity Total liabilities and stockholders' equity 38,486 $ 56,566 4 points Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year 33,420 $50,180 Sales Cost of goods sold eBook Hint Print References Gross margin Selling and administrative expenses: Selling expenses Administrative expenses Total selling and administrative expenses Net operating income Interest expense Net income before taxes Income taxes Net income Dividends to common stockholders Net income added to retained earnings Beginning retained earnings Ending retained earnings Required: Compute the following financial data for this year: Last Year $ 90,000 57,500 $ 85,000 53,500 32,500 31,500 9,600 9,100 13,100 12,100 22,700 21,200 9,800 10,300 750 750 9,050 9,550 3,620 3,820 5,430 364 5,730 728 5,066 27,760 5,002 22,758 $ 32,826 $ 27,760 1. Gross margin percentage. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) 2. Net profit margin percentage. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) 3. Return on total assets. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) 4. Return on equity. (Round your percentage answer to 2 decimal places (ie., 0.1234 should be entered as 12.34).) 1. Gross margin percentage 2. Net profit margin percentage 3. Return on total assets 4. Return on equity % %

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