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 $26. All of the company's sales are on account. Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 1,100 9,700 13,100 620 24,520 $ 1,260 8,000 11,700 520 21,480 9,500 54,081 63,581 $88, 101 9,500 40,780 50, 280 $71,760 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 $18,700 950 170 19,820 $19,300 810 170 20, 280 8,500 28,320 8,500 28,780 500 4,000 4,500 55, 281 59,781 $88, 101 500 4,000 4,500 38,480 42,980 $71,760 Weller Corporation Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $82,305 $65,000 Cost of goods sold 34,720 35,000 Gross margin 47,585 30,000 Selling and administrative expenses : Selling expenses 11,100 10,800 Administrative expenses 7,300 6,200 Total selling and administrative expenses 18,400 17,000 Net operating income 29,185 13,000 Interest expense 850 850 Net income before taxes 28, 335 12, 150 Income taxes 11,334 4,860 Net income 17,001 7,290 Dividends to common stockholders 200 250 Net income added to retained earnings 16,801 7,040 Beginning retained earnings 38,480 31,440 Ending retained earnings $55,281 $38, 480 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
