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 600,000 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 companys common stock at the end of this year was $26. All of the companys sales are on account.

Weller Corporation Comparative Balance Sheet (dollars in thousands)
	This Year			Last Year
Assets
Current assets:
Cash	$	1,190		$	1,340
Accounts receivable, net		9,700			7,900
Inventory		13,600			12,000
Prepaid expenses		610			590
Total current assets		25,100			21,830
Property and equipment:
Land		10,200			10,200
Buildings and equipment, net		45,232			37,866
Total property and equipment		55,432			48,066
Total assets	$	80,532		$	69,896
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	19,500		$	18,200
Accrued liabilities		920			770
Notes payable, short term		170			170
Total current liabilities		20,590			19,140
Long-term liabilities:
Bonds payable		9,400			9,400
Total liabilities		29,990			28,540
Stockholders' equity:
Common stock		600			600
Additional paid-in capital		4,000			4,000
Total paid-in capital		4,600			4,600
Retained earnings		45,942			36,756
Total stockholders' equity		50,542			41,356
Total liabilities and stockholders' equity	$	80,532		$	69,896

Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands)
	This Year			Last Year
Sales	$	74,000		$	65,000
Cost of goods sold		40,000			36,000
Gross margin		34,000			29,000
Selling and administrative expenses:
Selling expenses		10,600			10,500
Administrative expenses		6,400			6,800
Total selling and administrative expenses		17,000			17,300
Net operating income		17,000			11,700
Interest expense		940			940
Net income before taxes		16,060			10,760
Income taxes		6,424			4,304
Net income		9,636			6,456
Dividends to common stockholders		450			240
Net income added to retained earnings		9,186			6,216
Beginning retained earnings		36,756			30,540
Ending retained earnings	$	45,942		$	36,756

Required:

Compute the following financial data and ratios for this year:

1. Working capital. (Enter your answer in thousands.)

2. Current ratio. (Round your answer to 2 decimal places.)

3. Acid-test ratio. (Round your answer to 2 decimal places.)

3

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 600,000 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 companys common stock at the end of this year was $27. All of the companys sales are on account.

Weller Corporation Comparative Balance Sheet (dollars in thousands)
	This Year			Last Year
Assets
Current assets:
Cash	$	1,190		$	1,360
Accounts receivable, net		9,500			7,300
Inventory		12,500			12,300
Prepaid expenses		630			520
Total current assets		23,820			21,480
Property and equipment:
Land		10,600			10,600
Buildings and equipment, net		46,888			37,954
Total property and equipment		57,488			48,554
Total assets	$	81,308		$	70,034
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	20,400		$	17,500
Accrued liabilities		1,070			740
Notes payable, short term		0			170
Total current liabilities		21,470			18,410
Long-term liabilities:
Bonds payable		9,100			9,100
Total liabilities		30,570			27,510
Stockholders' equity:
Common stock		2,000			2,000
Additional paid-in capital		4,000			4,000
Total paid-in capital		6,000			6,000
Retained earnings		44,738			36,524
Total stockholders' equity		50,738			42,524
Total liabilities and stockholders' equity	$	81,308		$	70,034

Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands)
	This Year			Last Year
Sales	$	74,000		$	66,000
Cost of goods sold		41,000			38,000
Gross margin		33,000			28,000
Selling and administrative expenses:
Selling expenses		10,700			10,700
Administrative expenses		7,300			7,000
Total selling and administrative expenses		18,000			17,700
Net operating income		15,000			10,300
Interest expense		910			910
Net income before taxes		14,090			9,390
Income taxes		5,636			3,756
Net income		8,454			5,634
Dividends to common stockholders		240			450
Net income added to retained earnings		8,214			5,184
Beginning retained earnings		36,524			31,340
Ending retained earnings	$	44,738		$	36,524

Required:

Compute the following financial ratios for this year:

1. Times interest earned ratio.

2. Debt-to-equity ratio.

3. Equity multiplier.