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 830,000 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 $19.50. All of the companys sales are on account.
Weller Corporation Comparative Balance Sheet (dollars in thousands)
This Year
Last Year
Assets
Current assets:
Cash
$ 5,078
$ 5,190
Accounts receivable, net
12,600
9,250
Inventory
9,850
8,320
Prepaid expenses
1,830
2,160
Total current assets
29,358
24,920
Property and equipment:
Land
6,300
6,300
Buildings and equipment, net
19,500
19,300
Total property and equipment
25,800
25,600
Total assets
$ 55,158
$ 50,520
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable
$ 9,800
$ 8,450
Accrued liabilities
660
850
Notes payable, short term
330
330
Total current liabilities
10,790
9,630
Long-term liabilities:
Bonds payable
8,750
8,750
Total liabilities
19,540
18,380
Stockholders' equity:
Common stock
830
830
Additional paid-in capital
4,350
4,350
Total paid-in capital
5,180
5,180
Retained earnings
30,438
26,960
Total stockholders' equity
35,618
32,140
Total liabilities and stockholders' equity
$ 55,158
$ 50,520
Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands)
This Year
Last Year
Sales
$ 82,000
$ 77,000
Cost of goods sold
53,500
49,500
Gross margin
28,500
27,500
Selling and administrative expenses:
Selling expenses
8,800
8,300
Administrative expenses
12,300
11,300
Total selling and administrative expenses
21,100
19,600
Net operating income
7,400
7,900
Interest expense
1,050
1,050
Net income before taxes
6,350
6,850
Income taxes
2,540
2,740
Net income
3,810
4,110
Dividends to common stockholders
332
664
Net income added to retained earnings
3,478
3,446
Beginning retained earnings
26,960
23,514
Ending retained earnings
$ 30,438
$ 26,960
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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