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 980,000 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 company's common stock at the end of this year was $27.00. All of the company's sales are on account.
Weller Corporation
Comparative Balance Sheet
(dollars in thousands)This YearLast YearAssetsCurrent assets:Cash$4,568$5,440Accounts receivable, net16,2009,150Inventory10,6008,920Prepaid expenses1,9802,460Total current assets33,34825,970Property and equipment:Land7,8007,800Buildings and equipment, net21,00020,800Total property and equipment28,80028,600Total assets$62,148$54,570Liabilities and Stockholders' EquityCurrent liabilities:Accounts payable$11,300$9,200Accrued liabilities9601,600Notes payable, short term480480Total current liabilities12,74011,280Long-term liabilities:Bonds payable8,7508,750Total liabilities21,49020,030Stockholders' equity:Common stock980980Additional paid-in capital5,1005,100Total paid-in capital6,0806,080Retained earnings34,57828,460Total stockholders' equity40,65834,540Total liabilities and stockholders' equity$62,148$54,570
Weller Corporation
Comparative Income Statement and Reconciliation
(dollars in thousands)This YearLast YearSales$97,000$92,000Cost of goods sold61,00057,000Gross margin36,00035,000Selling and administrative expenses:Selling expenses10,3009,800Administrative expenses13,80012,800Total selling and administrative expenses24,10022,600Net operating income11,90012,400Interest expense1,0501,050Net income before taxes10,85011,350Income taxes4,3404,540Net income6,5106,810Dividends to common stockholders392784Net income added to retained earnings6,1186,026Beginning retained earnings28,46022,434Ending retained earnings$34,578$28,460
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 finalanswer 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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