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 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 $0.40 this year. The market value of the company's common stock at the end of the year was $29. All of the company's sales are on account. Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 1,210 10,000 12,100 770 24,080 $ 1,360 6,600 11,500 610 20,070 9, 200 46,938 56,138 $80,218 9,200 42,606 51,806 $71,876 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 $20,300 1,010 110 21,420 $18,900 760 110 19,770 9,400 30,820 9,400 29,170 700 4,000 700 4,000 Total paid-in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity 4,700 44,698 49,398 $80, 218 4,700 38,006 42,706 $71,876 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $73,040 $65,000 Cost of goods sold 42,480 34,000 Gross margin 30,560 31,000 Selling and administrative expenses: Selling expenses 11,000 10,700 Administrative expenses 7,000 6,500 Total selling and administrative expenses 18,000 17,200 Net operating income 12,560 13,800 Interest expense 940 940 Net income before taxes 11,620 12,860 Income taxes 4,648 5,144 Net income 6,972 7,716 Dividends to common stockholders 350 Net income added to retained earnings 6,692 7,366 Beginning retained earnings 38,006 30, 640 Ending retained earnings $ 44,698 $38,006 280 Required: Compute the following financial data for this year: 1. Accounts receivable turnover. (Assume that all sales are on account.) (Round your answer to 2 decimal places.) 2. Average collection period. (Use 365 days in a year. Round your intermediate calculations and final answer to 2 decimal places.) 3. Inventory turnover. (Round your answer to 2 decimal places.) 4. Average sale period. (Use 365 days in a year. Round your intermediate calculations and final answer to 2 decimal places.) 5. Operating cycle. (Round your intermediate calculations and final answer to 2 decimal places.) 6. Total asset turnover. (Round your answer to 2 decimal places.) days | 1. Accounts receivable turnover 2. Average collection period 3. Inventory turnover Average sale period 5. Operating cycle 6. Total asset turnover days days
