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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 700,000 shares of common stock were outstanding. The interest rate on the bond payable was 10%, 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. All of the companys sales are on account.

Weller Corporation Comparative Balance Sheet (dollars in thousands)
	This Year	Last Year
Assets
Current assets:
Cash	$ 1,150	$ 1,320
Accounts receivable, net	10,700	8,400
Inventory	12,100	12,300
Prepaid expenses	610	530
Total current assets	24,560	22,550
Property and equipment:
Land	9,900	9,900
Buildings and equipment, net	44,123	39,579
Total property and equipment	54,023	49,479
Total assets	$ 78,583	$ 72,029
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$ 20,000	$ 18,500
Accrued liabilities	1,100	830
Notes payable, short term	0	270
Total current liabilities	21,100	19,600
Long-term liabilities:
Bonds payable	8,100	8,100
Total liabilities	29,200	27,700
Stockholders' equity:
Common stock	2,000	2,000
Additional paid-in capital	4,000	4,000
Total paid-in capital	6,000	6,000
Retained earnings	43,383	38,329
Total stockholders' equity	49,383	44,329
Total liabilities and stockholders' equity	$ 78,583	$ 72,029

Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands)
	This Year	Last Year
Sales	$ 68,000	$ 64,000
Cost of goods sold	40,000	32,000
Gross margin	28,000	32,000
Selling and administrative expenses:
Selling expenses	11,300	10,700
Administrative expenses	7,000	6,800
Total selling and administrative expenses	18,300	17,500
Net operating income	9,700	14,500
Interest expense	810	810
Net income before taxes	8,890	13,690
Income taxes	3,556	5,476
Net income	5,334	8,214
Dividends to common stockholders	280	525
Net income added to retained earnings	5,054	7,689
Beginning retained earnings	38,329	30,640
Ending retained earnings	$ 43,383	$ 38,329

Required:

Compute the following financial ratios for this year:

1. Times interest earned ratio.

2. Debt-to-equity ratio.

3. Equity multiplier.

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