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 the year was $28. All of the company's sales are on account. Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 1,240 10,800 13,600 800 26, 440 $ 1,330 8,000 12,400 550 22, 280 9,800 49,706 59,506 $ 85,946 9,800 39,488 49, 288 $71,568 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 $18,500 1,080 100 19,680 $18,100 720 100 18,920 9,700 29,380 9,700 28,620 500 4,000 4,500 52,066 56,566 $ 85,946 500 4,000 4,500 38,448 42,948 $71,568 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $ 89,300 $65,000 Cost of goods sold 48, 100 35,000 Gross margin 41,200 30,000 Selling and administrative expenses: Selling expenses 10,700 10,000 Administrative expenses 6,500 6,600 Total selling and administrative expenses 17,200 16,600 Net operating income 24,000 13,400 Interest expense 970 970 Net income before taxes 23,030 12,430 Income taxes 9,212 4,972 Net income 13,818 7,458 Dividends to common stockholders 250 Net income added to retained earnings 13,618 7, 208 Beginning retained earnings 38,448 31, 240 Ending retained earnings $52,066 $38,448 200 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 4. Average sale period 5. Operating cycle 6. Total asset turnover days days
