Comparative financial statements for Weller Corporation, a merchandising company, for the year ending December 31 appear...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
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 company's common stock at the end of this year was $20. All of the company's sales are on account. Weller Corporation Comparative Balance Sheet (dollars in thousands) Assets Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Property and equipment: Land Buildings and equipment, net Total property and equipment Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Accrued liabilities Notes payable, short term Total current Liabilities Long-term liabilities: Bonds payable Total liabilities Stockholders' equity: Common stock Additional paid-in capital Total paid-in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Weller Corporation This Year Last Year $ 1,120 10,700 14,000 740 $1,280 8,200 12,400 560 26,560 22,440 10,600 10,600 47,974 39,402 58,574 50,002 $ 85,134 $72,442 $ 20,300 $ 18,600 980 810 B 160 21,280 19,578 9,308 9,300 30,580 28,870 2,000 2,000 4,000 4,000 6,000 6,008 48,554 37,572 54,554 43,572 $ 85,134 $ 72,442 Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales Cost of goods sold a 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 incon Dividends to common stockholders Net income added to retained earnings Beginning retained earnings Ending retained earnings Required: Compute the following financial ratios for this year; 1. Times interest eamed ratio. 2. Debt-to-equity ratio 3. Equity multiplier $ 75,000 $ 64,000 38,000 37,000 34,000 30,000 10,600 10,000 6,700 6,300 17,300 17,100 19,700 12,900 930 10,770 7,508 11,262 930 11,970 4,788 7,182 350 280 10,982 37,572 $ 48,554 6,832 30,740 $ 37,572 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 company's common stock at the end of this year was $20. All of the company's sales are on account. Weller Corporation Comparative Balance Sheet (dollars in thousands) Assets Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Property and equipment: Land Buildings and equipment, net Total property and equipment Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Accrued liabilities Notes payable, short term Total current Liabilities Long-term liabilities: Bonds payable Total liabilities Stockholders' equity: Common stock Additional paid-in capital Total paid-in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Weller Corporation This Year Last Year $ 1,120 10,700 14,000 740 $1,280 8,200 12,400 560 26,560 22,440 10,600 10,600 47,974 39,402 58,574 50,002 $ 85,134 $72,442 $ 20,300 $ 18,600 980 810 B 160 21,280 19,578 9,308 9,300 30,580 28,870 2,000 2,000 4,000 4,000 6,000 6,008 48,554 37,572 54,554 43,572 $ 85,134 $ 72,442 Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales Cost of goods sold a 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 incon Dividends to common stockholders Net income added to retained earnings Beginning retained earnings Ending retained earnings Required: Compute the following financial ratios for this year; 1. Times interest eamed ratio. 2. Debt-to-equity ratio 3. Equity multiplier $ 75,000 $ 64,000 38,000 37,000 34,000 30,000 10,600 10,000 6,700 6,300 17,300 17,100 19,700 12,900 930 10,770 7,508 11,262 930 11,970 4,788 7,182 350 280 10,982 37,572 $ 48,554 6,832 30,740 $ 37,572
Expert Answer:
Posted Date:
Students also viewed these accounting questions
-
Determine whether each function is one-to-one. If it is, find the inverse. f(x) = 4x - 1
-
Unearned Revenue had a balance of $650 at the end of November and $450 at the end of December. Service Revenue was $2,550 for the month of December. How much cash was received for services provided...
-
For the data in Table Q6.5 (page 191), calculate the items indicated. Table Q6.5 Percentage GM Change Dividend Percentage Deviation Variance Year Price in Price Yield Return of Returns of Returns...
-
Name three common types of responsibility centers for decentralized operations.
-
Wham-O is a distributor of board games and water toys manufactured by other companies. The company utilizes a shared Testing Facility where toys are safety tested. The Board Games division uses 3,000...
-
12. The NYS transit authority is interested in the construction of a cross-sound bridge to connect Long Island directly to Connecticut. Since she's been in hot water recently and fears her...
-
1. The mechanic knew either the oil filter was clogged or the oil pump was defective. He just replaced the oil filter. If he has replaced the oil filter, then he knew the oil pump is defective....
-
Identify the major categories of ratios that can be used for analysis purposes.
-
Discuss the limitations of ratios as a tool of financial analysis.
-
What is the accounting basis for consolidating assets and liabilities in a business combination recorded using the acquisition method?
-
Discuss the use of ratios in helping to predict financial failure.
-
Under the fair-value option, which of the following affects the income the investor recognizes from its ownership of the investee? a. The investees reported income adjusted for excess cost over book...
-
In the current year, the Village of Cheshire collected delinquent taxes in the amount of $530,000, on which interest and penalties of $25,000 had been accrued at the end of 2016; further $4,000...
-
Ex. (17): the vector field F = x i-zj + yz k is defined over the volume of the cuboid given by 0x a,0 y b, 0zc, enclosing the surface S. Evaluate the surface integral ff, F. ds?
-
Modify the spread sheet to handle development costs.
-
What is a What if analysis?
-
You developed an overhead budget for a construction company. Historically, the companys construction costs are 89% of revenues. What volume of work does the construction company need to achieve in...
Study smarter with the SolutionInn App