Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year Assets Current assets: Cash $ 4,774 $ 5,550 Accounts receivable, net 15,300 10,200 Inventory 10,150 8,560 Prepaid expenses 1,890 2,280 Total current assets 32,114 26,590 Property and equipment: Land 6,900 6,900 Buildings and equipment, net 20,100 19,900 Total property and equipment 27,000 26,800 Total assets $ 59,114 $ 53,390 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 10,400 $ 8,750 Accrued liabilities 780 1,150 Notes payable, short term 390 390 Total current liabilities 11,570 10,290 Long-term liabilities: Bonds payable 10,000 10,000 Total liabilities 21,570 20,290 Stockholders' equity: Common stock 890 890 Additional paid-in capital 4,650 4,650 Total paid-in capital 5,540 5,540 Retained earnings 32,004 27,560 Total stockholders' equity 37,544 33,100 Total liabilities and stockholders' equity $ 59,114 $ 53,390 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $ 88,000 $ 83,000 Cost of goods sold 56,500 52,500 Gross margin 31,500 30,500 Selling and administrative expenses: Selling expenses 9,400 8,900 Administrative expenses 12,900 11,900 Total selling and administrative expenses 22,300 20,800 Net operating income 9,200 9,700 Interest expense 1,200 1,200 Net income before taxes 8,000 8,500 Income taxes 3,200 3,400 Net income 4,800 5,100 Dividends to common stockholders 356 712 Net income added to retained earnings 4,444 4,388 Beginning retained earnings 27,560 23,172 Ending retained earnings $ 32,004 $ 27,560

Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year Assets Current assets: Cash $ 4,774 $ 5,550 Accounts receivable, net 15,300 10,200 Inventory 10,150 8,560 Prepaid expenses 1,890 2,280 Total current assets 32,114 26,590 Property and equipment: Land 6,900 6,900 Buildings and equipment, net 20,100 19,900 Total property and equipment 27,000 26,800 Total assets $ 59,114 $ 53,390 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 10,400 $ 8,750 Accrued liabilities 780 1,150 Notes payable, short term 390 390 Total current liabilities 11,570 10,290 Long-term liabilities: Bonds payable 10,000 10,000 Total liabilities 21,570 20,290 Stockholders' equity: Common stock 890 890 Additional paid-in capital 4,650 4,650 Total paid-in capital 5,540 5,540 Retained earnings 32,004 27,560 Total stockholders' equity 37,544 33,100 Total liabilities and stockholders' equity $ 59,114 $ 53,390 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $ 88,000 $ 83,000 Cost of goods sold 56,500 52,500 Gross margin 31,500 30,500 Selling and administrative expenses: Selling expenses 9,400 8,900 Administrative expenses 12,900 11,900 Total selling and administrative expenses 22,300 20,800 Net operating income 9,200 9,700 Interest expense 1,200 1,200 Net income before taxes 8,000 8,500 Income taxes 3,200 3,400 Net income 4,800 5,100 Dividends to common stockholders 356 712 Net income added to retained earnings 4,444 4,388 Beginning retained earnings 27,560 23,172 Ending retained earnings $ 32,004 $ 27,560

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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Question

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 890,000 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 the year was $22. 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	$	4,774	$	5,550
Accounts receivable, net		15,300		10,200
Inventory		10,150		8,560
Prepaid expenses		1,890		2,280
Total current assets		32,114		26,590
Property and equipment:
Land		6,900		6,900
Buildings and equipment, net		20,100		19,900
Total property and equipment		27,000		26,800
Total assets	$	59,114	$	53,390
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	10,400	$	8,750
Accrued liabilities		780		1,150
Notes payable, short term		390		390
Total current liabilities		11,570		10,290
Long-term liabilities:
Bonds payable		10,000		10,000
Total liabilities		21,570		20,290
Stockholders' equity:
Common stock		890		890
Additional paid-in capital		4,650		4,650
Total paid-in capital		5,540		5,540
Retained earnings		32,004		27,560
Total stockholders' equity		37,544		33,100
Total liabilities and stockholders' equity	$	59,114	$	53,390

Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands)
	This Year	Last Year
Sales	$	88,000	$	83,000
Cost of goods sold		56,500		52,500
Gross margin		31,500		30,500
Selling and administrative expenses:
Selling expenses		9,400		8,900
Administrative expenses		12,900		11,900
Total selling and administrative expenses		22,300		20,800
Net operating income		9,200		9,700
Interest expense		1,200		1,200
Net income before taxes		8,000		8,500
Income taxes		3,200		3,400
Net income		4,800		5,100
Dividends to common stockholders		356		712
Net income added to retained earnings		4,444		4,388
Beginning retained earnings		27,560		23,172
Ending retained earnings	$	32,004	$	27,560