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Comparative financial statements for Weller Corporation, a merchandising company, for the fiscal year ending December 31 appear below. The company did not issue any new common stock during the year. A total of 500,000 shares of common stock were outstanding. The interest rate on the bonds, which were sold at their face value, was 10%. The income tax rate was 40% and the dividend per share of common stock was $1.00 last year and $0.65 this year. The market value of the company's common stock at the end of the year was $21. All of the company's sales are on account. Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales Weller Corporation Comparative Balance Sheet (dollars in thousands) $67,000 $65,000 40,000 Cost of goods sold 39,000 This Year Last Year 27,000 26,000 Assets Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Gross margin $ 1,190 9,400 12,100 800 $ 1,290 7,200 12,200 560 Selling and administrative expenses: Selling expenses Administrative expenses 11,000 7,000 10,700 6,500 Total current assets 23,490 21,250 Total selling and administrative expenses 18,000 17,200 Property and equipment: Land Buildings and equipment, net 11,000 38,795 11,000 34,500 Net operating income Interest expense 9,000 850 8,800 850 Total property and equipment 49,795 45,500

Comparative financial statements for Weller Corporation, a merchandising company, for the fiscal year ending December 31 appear below. The company did not issue any new common stock during the year. A total of 500,000 shares of common stock were outstanding. The interest rate on the bonds, which were sold at their face value, was 10%. The income tax rate was 40% and the dividend per share of common stock was $1.00 last year and $0.65 this year. The market value of the company's common stock at the end of the year was $21. All of the company's sales are on account. Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales Weller Corporation Comparative Balance Sheet (dollars in thousands) $67,000 $65,000 40,000 Cost of goods sold 39,000 This Year Last Year 27,000 26,000 Assets Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Gross margin $ 1,190 9,400 12,100 800 $ 1,290 7,200 12,200 560 Selling and administrative expenses: Selling expenses Administrative expenses 11,000 7,000 10,700 6,500 Total current assets 23,490 21,250 Total selling and administrative expenses 18,000 17,200 Property and equipment: Land Buildings and equipment, net 11,000 38,795 11,000 34,500 Net operating income Interest expense 9,000 850 8,800 850 Total property and equipment 49,795 45,500

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter16: Financial Statement Analysis
Section: Chapter Questions
Problem 21E
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Comparative financial statements for Weller Corporation, a merchandising company, for the fiscal year ending December 31 appear below. The company did not issue any new common stock during the year. A total of 500,000 shares of common stock were outstanding. The interest rate on the bonds, which were sold at their face value, was 10%. The income tax rate was 40% and the dividend per share of common stock was $1.00 last year and $0.65 this year. The market value of the company's common stock at the end of the year was $21. All of the company's sales are on account. Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales Weller Corporation Comparative Balance Sheet (dollars in thousands) $67,000 $65,000 40,000 Cost of goods sold 39,000 This Year Last Year 27,000 26,000 Assets Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Gross margin $ 1,190 9,400 12,100 800 $ 1,290 7,200 12,200 560 Selling and administrative expenses: Selling expenses Administrative expenses 11,000 7,000 10,700 6,500 Total current assets 23,490 21,250 Total selling and administrative expenses 18,000 17,200 Property and equipment: Land Buildings and equipment, net 11,000 38,795 11,000 34,500 Net operating income Interest expense 9,000 850 8,800 850 Total property and equipment 49,795 45,500
Transcribed Image Text:Comparative financial statements for Weller Corporation, a merchandising company, for the fiscal year ending December 31 appear below. The company did not issue any new common stock during the year. A total of 500,000 shares of common stock were outstanding. The interest rate on the bonds, which were sold at their face value, was 10%. The income tax rate was 40% and the dividend per share of common stock was $1.00 last year and $0.65 this year. The market value of the company's common stock at the end of the year was $21. All of the company's sales are on account. Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales Weller Corporation Comparative Balance Sheet (dollars in thousands) $67,000 $65,000 40,000 Cost of goods sold 39,000 This Year Last Year 27,000 26,000 Assets Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Gross margin $ 1,190 9,400 12,100 800 $ 1,290 7,200 12,200 560 Selling and administrative expenses: Selling expenses Administrative expenses 11,000 7,000 10,700 6,500 Total current assets 23,490 21,250 Total selling and administrative expenses 18,000 17,200 Property and equipment: Land Buildings and equipment, net 11,000 38,795 11,000 34,500 Net operating income Interest expense 9,000 850 8,800 850 Total property and equipment 49,795 45,500
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