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
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 820,000 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 companys common stock at the end of this year was $19.00. All of the companys sales are on account.
Weller Corporation Comparative Balance Sheet (dollars in thousands) | ||
This Year | Last Year | |
---|---|---|
Assets | ||
Current assets: | ||
Cash | $ 3,812 | $ 3,980 |
Accounts receivable, net | 12,500 | 9,200 |
Inventory | 9,800 | 8,280 |
Prepaid expenses | 1,820 | 2,140 |
Total current assets | 27,932 | 23,600 |
Property and equipment: | ||
Land | 6,200 | 6,200 |
Buildings and equipment, net | 19,400 | 19,200 |
Total property and equipment | 25,600 | 25,400 |
Total assets | $ 53,532 | $ 49,000 |
Liabilities and Stockholders' Equity | ||
Current liabilities: | ||
Accounts payable | $ 9,700 | $ 8,400 |
Accrued liabilities | 640 | 800 |
Notes payable, short term | 320 | 320 |
Total current liabilities | 10,660 | 9,520 |
Long-term liabilities: | ||
Bonds payable | 7,500 | 7,500 |
Total liabilities | 18,160 | 17,020 |
Stockholders' equity: | ||
Common stock | 820 | 820 |
Additional paid-in capital | 4,300 | 4,300 |
Total paid-in capital | 5,120 | 5,120 |
Retained earnings | 30,252 | 26,860 |
Total stockholders' equity | 35,372 | 31,980 |
Total liabilities and stockholders' equity | $ 53,532 | $ 49,000 |
Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) | ||
This Year | Last Year | |
---|---|---|
Sales | $ 81,000 | $ 76,000 |
Cost of goods sold | 53,000 | 49,000 |
Gross margin | 28,000 | 27,000 |
Selling and administrative expenses: | ||
Selling expenses | 8,700 | 8,200 |
Administrative expenses | 12,200 | 11,200 |
Total selling and administrative expenses | 20,900 | 19,400 |
Net operating income | 7,100 | 7,600 |
Interest expense | 900 | 900 |
Net income before taxes | 6,200 | 6,700 |
Income taxes | 2,480 | 2,680 |
Net income | 3,720 | 4,020 |
Dividends to common stockholders | 328 | 656 |
Net income added to retained earnings | 3,392 | 3,364 |
Beginning retained earnings | 26,860 | 23,496 |
Ending retained earnings | $ 30,252 | $ 26,860 |
Required:
Compute the following financial data for this year:
1. Earnings per share. (Round your answer to 2 decimal places.)
2. Price-earnings ratio. (Round your intermediate calculations and final answer to 2 decimal places.)
3. Dividend payout ratio. (Round your intermediate calculations and final answer to 2 decimal places.)
4. Dividend yield ratio. (Round your intermediate calculations and final answer to 2 decimal places.)
5. Book value per share. (Round your answer to 2 decimal places.)
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