Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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 860,000 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 $21.00. All of the companys sales are on account.

image text in transcribedimage text in transcribedimage text in transcribed

Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 976 15,000 10,000 1,860 27,836 $ 1,920 10,050 8,440 2,220 22,630 6,600 19,800 26,400 $ 54,236 6,600 19,600 26, 200 $ 48,830 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 $ 10,100 720 360 11,180 $ 8,600 1,000 360 9,960 6,250 17,430 6,250 16, 210 860 4,500 5, 360 31,446 36,806 $ 54,236 860 4,500 5,360 27,260 32,620 $ 48,830 Last Year $ 80,000 51,000 29,000 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Sales $ 85,000 Cost of goods sold 55,000 Gross margin 30,000 Selling and administrative expenses: Selling expenses 9,100 Administrative expenses 12,600 Total selling and administrative expenses 21,700 Net operating income 8,300 Interest expense 750 Net income before taxes 7,550 Income taxes 3,020 Net income 4,530 Dividends to common stockholders 344 Net income added to retained earnings 4,186 Beginning retained earnings 27,260 Ending retained earnings $ 31,446 8,600 11,600 20,200 8,800 750 8,050 3,220 4,830 688 4,142 23, 118 $ 27,260 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.) 1. Earnings per share 2. Price-earnings ratio 3. Dividend payout ratio 4. Dividend yield ratio 5. Book value per share % %

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Pioneers Of A Profession Chartered Accountants To 1879

Authors: Jas. C. Stewart

1st Edition

0367532557, 9780367532550

More Books

Students also viewed these Accounting questions

Question

What is the difference between risk aversion and loss aversion?

Answered: 1 week ago