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 $25. All of the company's sales are on account Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 1,220 10,000 12,100 780 24,100 $ 1,230 8,400 12,600 580 22,810 9,700 56,749 66,449 $ 90,549 9,700 39,322 49,022 $ 71,832 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 uitv $ 20,200 960 160 21,320 $ 18,500 750 160 19, 410 9,300 30, 620 9,300 28,710 500 4,000 4,500 55,429 59,929 $ 90.549 500 4,000 4,500 38,622 43, 122 $ 71,832 Last Year $ 66,000 35,000 31,000 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Sales $ 85,560 Cost of goods sold 38,285 Gross margin 47,275 Selling and administrative expenses : Selling expenses 11,200 Administrative expenses 6,800 Total selling and administrative expenses 18,000 Net operating income 29,275 Interest expense 930 Net income before taxes 28,345 Income taxes 11,338 Net income 17,007 Dividends to common stockholders 200 Net income added to retained earnings 16,807 Beginning retained earnings 38,622 Ending retained earnings $ 55,429 10,600 6,500 17,100 13,900 930 12,970 5,188 7,782 500 7,282 31, 340 $ 38,622 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 2. Average collection period. (Use 365 days in a year. Round your intermediate calculations and 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 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.) 9.20 Answer is complete but not entirely correct. 1. Accounts receivable tumover 2. Average collection period 39.60 days 3. Inventory turnover 3.10 4. Average sale period 117.74 days 5. Operating cycle 158.75 days 6. Total asset turnover 1.07 X
