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 850,000 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 $20.50. All of the company’s sales are on account. Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year Assets Current assets: Cash $ 1,810 $ 710 Accounts receivable, net 12,800 10,000 Inventory 9,950 8,400 Prepaid expenses 1,850 2,200 Total current assets 26,410 21,310 Property and equipment: Land 6,500 6,500 Buildings and equipment, net 19,700 19,500 Total property and equipment 26,200 26,000 Total assets $ 52,610 $ 47,310 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 10,000 $ 8,550 Accrued liabilities 700 950 Notes payable, short term 350 350 Total current liabilities 11,050 9,850 Long-term liabilities: Bonds payable 5,000 5,000 Total liabilities 16,050 14,850 Stockholders' equity: Common stock 850 850 Additional paid-in capital 4,450 4,450 Total paid-in capital 5,300 5,300 Retained earnings 31,260 27,160 Total stockholders' equity 36,560 32,460 Total liabilities and stockholders' equity $ 52,610 $ 47,310 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $ 84,000 $ 79,000 Cost of goods sold 54,500 50,500 Gross margin 29,500 28,500 Selling and administrative expenses: Selling expenses 9,000 8,500 Administrative expenses 12,500 11,500 Total selling and administrative expenses 21,500 20,000 Net operating income 8,000 8,500 Interest expense 600 600 Net income before taxes 7,400 7,900 Income taxes 2,960 3,160 Net income 4,440 4,740 Dividends to common stockholders 340 680 Net income added to retained earnings 4,100 4,060 Beginning retained earnings 27,160 23,100 Ending retained earnings $ 31,260 $ 27,160 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.)

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 850,000 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 $20.50. All of the company’s sales are on account. Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year Assets Current assets: Cash $ 1,810 $ 710 Accounts receivable, net 12,800 10,000 Inventory 9,950 8,400 Prepaid expenses 1,850 2,200 Total current assets 26,410 21,310 Property and equipment: Land 6,500 6,500 Buildings and equipment, net 19,700 19,500 Total property and equipment 26,200 26,000 Total assets $ 52,610 $ 47,310 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 10,000 $ 8,550 Accrued liabilities 700 950 Notes payable, short term 350 350 Total current liabilities 11,050 9,850 Long-term liabilities: Bonds payable 5,000 5,000 Total liabilities 16,050 14,850 Stockholders' equity: Common stock 850 850 Additional paid-in capital 4,450 4,450 Total paid-in capital 5,300 5,300 Retained earnings 31,260 27,160 Total stockholders' equity 36,560 32,460 Total liabilities and stockholders' equity $ 52,610 $ 47,310 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $ 84,000 $ 79,000 Cost of goods sold 54,500 50,500 Gross margin 29,500 28,500 Selling and administrative expenses: Selling expenses 9,000 8,500 Administrative expenses 12,500 11,500 Total selling and administrative expenses 21,500 20,000 Net operating income 8,000 8,500 Interest expense 600 600 Net income before taxes 7,400 7,900 Income taxes 2,960 3,160 Net income 4,440 4,740 Dividends to common stockholders 340 680 Net income added to retained earnings 4,100 4,060 Beginning retained earnings 27,160 23,100 Ending retained earnings $ 31,260 $ 27,160 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.)

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 54E: Rebert Inc. showed the following balances for last year: Reberts net income for last year was...

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Question

	This Year	Last Year
Weller Corporation Comparative Balance Sheet (dollars in thousands)
Assets
Current assets:
Cash	$ 1,810	$ 710
Accounts receivable, net	12,800	10,000
Inventory	9,950	8,400
Prepaid expenses	1,850	2,200
Total current assets	26,410	21,310
Property and equipment:
Land	6,500	6,500
Buildings and equipment, net	19,700	19,500
Total property and equipment	26,200	26,000
Total assets	$ 52,610	$ 47,310
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$ 10,000	$ 8,550
Accrued liabilities	700	950
Notes payable, short term	350	350
Total current liabilities	11,050	9,850
Long-term liabilities:
Bonds payable	5,000	5,000
Total liabilities	16,050	14,850
Stockholders' equity:
Common stock	850	850
Additional paid-in capital	4,450	4,450
Total paid-in capital	5,300	5,300
Retained earnings	31,260	27,160
Total stockholders' equity	36,560	32,460
Total liabilities and stockholders' equity	$ 52,610	$ 47,310

	This Year	Last Year
Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands)
Sales	$ 84,000	$ 79,000
Cost of goods sold	54,500	50,500
Gross margin	29,500	28,500
Selling and administrative expenses:
Selling expenses	9,000	8,500
Administrative expenses	12,500	11,500
Total selling and administrative expenses	21,500	20,000
Net operating income	8,000	8,500
Interest expense	600	600
Net income before taxes	7,400	7,900
Income taxes	2,960	3,160
Net income	4,440	4,740
Dividends to common stockholders	340	680
Net income added to retained earnings	4,100	4,060
Beginning retained earnings	27,160	23,100
Ending retained earnings	$ 31,260	$ 27,160