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 500.000 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 company's common stock at the end of this year was $24. All of the company's sales are on account Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 1,119 9,789 12,580 680 23,990 $ 1,250 6,780 12,680 510 21,960 9,180 49,817 58,917 $82,907 9,180 42,911 52,011 $73,971 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 Total paid-in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $19, 4ee 1,870 @ 20,470 $19,380 810 230 20, 340 9,980 39,370 9,988 30, 240 2,820 4,000 6,080 46,537 52,537 $82,987 2,880 4,08 6,08 36,831 42,831 $73,071 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $70,000 $65,eee Cost of goods sold 35,eee 37,eee Gross margin 35,000 28,080 Selling and administrative expenses: Selling expenses 12,880 12, 280 Administrative expenses 6,700 6,780 Total selling and administrative expenses 17,5ee 16,990 Net operating income 17,5ee 11,180 Interest expense 990 990 Net income before taxes 16,510 10, 110 Income taxes 6,684 4,844 Net income 9,986 6,866 Dividends to common stockholders 2ee 375 Net income added to retained earnings 9,786 5,691 Beginning retained earnings 36,831 31,140 Ending retained earnings $46,537 $36,831 10 Required: Compute the following financial ratios for this year. 1. Times interest eamed ratio. 2 Debt-to-equity ratio 3. Equity multiplier. (For all requlrements, round your answers to 2 decimal places.) 1. 2. 3. Times interest earned ratio Debt-to-equity ratio Equity multiplier
