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 930,000 shares of common stock were outstanding. The interest rate on the bonds, which were sold at their face value, was 12%. The income tax rate was 40% and the dividend per share of common stock was 50.40 this year. The market value of the company's common stock at the end of the year was $24. 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 $ 4,038 $ 4,140 Accounts receivable, net 15,700 10,400 Inventory 10,350 8,720 Prepaid expenses 1,930 2,360 Total current assets 32,018 25,620 Property and equipment: Land 7,300 7,300 Buildings and equipment, net 20,500 20,300 Total property and equipment 27,800 27,600 Total assets $59,818 $53,220 $10,800 860 430 $ 8,950 1,350 430 12.090 10,730 8,750 8,750 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 20,840 19,480 930 4,850 930 4,850 5,780 33,198 5,780 27,960 38,978 33,740 $59,818 $53,220 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $92,000 $87,000 Cost of goods sold 58,500 54,500 33,500 32,500 Gross margin Selling and administrative expenses: Selling expenses Administrative expenses Total selling and administrative expenses Net operating income Interest expense 9,800 13,300 9,300 12.300 23,100 21,600 10,400 1,050 10,900 1,050 Net income before taxes Income taxes 9,350 3,740 9,850 3,940 5,610 372 5,910 651 Net income Dividends to common stockholders Net income added to retained earnings Beginning retained earnings Ending retained earnings 5,238 27,960 5,259 22,701 $33,198 $27,960 Required: Compute the following financial data for this year: 1. Gross margin percentage. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) Gross margin percentage % 2. Net profit margin percentage. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) Net profit margin percentage % 3. Return on total assets. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) Return on total assets % 4. Return on equity. (Round your percentage answer to 2 decimal places (i.e., 0.1234 should be entered as 12.34).) Return on equity %
