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

image text in transcribed
image text in transcribed
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 company's common stock at the end of the year was $26. All of the company's sales are on account. This Year Last Year $ 2,036 16,000 10,500 1,960 30,496 $ 3,020 9,050 8,840 2,420 23, 330 Weller Corporation Comparative Balance Sheet (dollars in thousands) 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 Habilities: Accounts payable Accrued liabilities Notes payable, short term Total current liabilities Long-term liabilities: Bonds payable Total liabilities Stockholders' equity : Common stock Additional pald-in capital Total paid in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity 7,600 20,800 28,400 $58,896 7,600 20,600 28,200 $51,530 $11,100 920 46e 12,480 $ 9, 100 1,500 460 11,060 6,258 18,730 6,250 17,310 960 5.000 5,960 34,206 40,166 $58, 896 960 5.ee 5,960 28,260 34,220 $51,530 Weller corporat Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $95,000 $90,000 Cost of goods sold 60,000 56,000 Gross margin 35,000 34,000 Selling and administrative expenses: Selling expenses 10,100 9,600 Administrative expenses 13,600 12,600 Total selling and administrative expenses 23,700 22,200 Net operating income 11,300 11,800 Interest expense 750 750 Net income before taxes 10,550 11,050 Income taxes 4,220 4,420 Net Income 6,330 6,630 Dividends to common stockholders 384 768 Net income added to retained earnings 5,946 5,862 Beginning retained earnings 28,260 22,398 Ending retained earnings $34,206 $28,260 Required: Compute the following financial data for this year: 1. Gross margin percentage. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) 2. Net profit margin percentage. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) 3. Return on total assets. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) 4. Return on equity. (Round your percentage answer to 2 decimal places (ie, 0.1234 should be entered as 12.34).) % 1. Gross margin percentage 2. Net profit margin percentage 3. Return on total assets 4 Return on equity % % %

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_2

Step: 3

blur-text-image_3

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

The Social Function Of AccountsReforming Accountancy To Serve Mankind

Authors: John Flower

1st Edition

1138645249, 9781138645240

More Books

Students explore these related Accounting questions