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 $28. 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 $ 1,220 11,000 13,800 700 26,720 $ 1,260 7,200 12,500 600 21,560 10,200 43,348 53,548 $80, 268 10,200 37,735 47,935 $69,495 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 ent 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 $19,800 1,000 150 20,950 $18,000 800 150 18,950 9,000 29,950 9,000 27,950 500 4,000 4,500 45,818 50,318 $80, 268 500 4,000 4,500 37,045 41,545 $69,495 Last Year $66,000 38,000 28,000 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Sales $82,810 Cost of goods sold 48,655 Gross margin 34,155 Selling and administrative expenses : Selling expenses 11,300 Administrative expenses 7,000 Total selling and administrative expenses 18,300 Net operating income 15,855 Interest expense 900 Net income before taxes 14,955 Income taxes 5,982 Net income 8,973 Dividends to common stockholders 200 Net income added to retained earnings 8,773 Beginning retained earnings 37,045 Ending retained earnings $45,818 10,600 6,200 16,800 9000 11,200 900 10,300 4,120 6,180 375 5,805 31,240 $37,045 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
