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 960,000 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 $26.00. All of the companys sales are on account.
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.)
Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 2,036 16,000 10,500 1,960 30,496 $ 3,020 9,050 8,840 2,420 23,330 7,600 20,800 28,400 $58,896 7,600 20,600 28, 200 $51,530 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 $11,100 920 460 12,480 $ 9,100 1,500 460 11,060 6,250 18,730 6,250 17,310 960 5,000 5,960 34,206 40,166 $58,896 960 5,000 5,960 28,260 34,220 $51,530 Last Year $90,000 56,000 34,000 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Sales $95,000 Cost of goods sold 60,000 Gross margin 35,000 Selling and administrative expenses: Selling expenses 10,100 Administrative expenses 13,600 Total selling and administrative expenses 23,700 Net operating income 11,300 Interest expense 750 Net income before taxes 10,550 Income taxes 4,220 Net income 6,330 Dividends to common stockholders 384 Net income added to retained earnings 5,946 Beginning retained earnings 28,260 Ending retained earnings $34,206 9,600 12,600 22,200 11,800 750 11,050 4,420 6,630 768 5,862 22,398 $28,260 1. Earnings per share 2. Price-earnings ratio 3. Dividend payout ratio 4. Dividend yield ratio 5. Book value per share % %
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