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 980,000 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 the year was $27.00. All of the companys sales are on account.
Weller Corporation Comparative Balance Sheet (dollars in thousands) | ||||||
This Year | Last Year | |||||
Assets | ||||||
Current assets: | ||||||
Cash | $ | 4,568 | $ | 5,440 | ||
Accounts receivable, net | 16,200 | 9,150 | ||||
Inventory | 10,600 | 8,920 | ||||
Prepaid expenses | 1,980 | 2,460 | ||||
Total current assets | 33,348 | 25,970 | ||||
Property and equipment: | ||||||
Land | 7,800 | 7,800 | ||||
Buildings and equipment, net | 21,000 | 20,800 | ||||
Total property and equipment | 28,800 | 28,600 | ||||
Total assets | $ | 62,148 | $ | 54,570 | ||
Liabilities and Stockholders' Equity | ||||||
Current liabilities: | ||||||
Accounts payable | $ | 11,300 | $ | 9,200 | ||
Accrued liabilities | 960 | 1,600 | ||||
Notes payable, short term | 480 | 480 | ||||
Total current liabilities | 12,740 | 11,280 | ||||
Long-term liabilities: | ||||||
Bonds payable | 8,750 | 8,750 | ||||
Total liabilities | 21,490 | 20,030 | ||||
Stockholders' equity: | ||||||
Common stock | 980 | 980 | ||||
Additional paid-in capital | 5,100 | 5,100 | ||||
Total paid-in capital | 6,080 | 6,080 | ||||
Retained earnings | 34,578 | 28,460 | ||||
Total stockholders' equity | 40,658 | 34,540 | ||||
Total liabilities and stockholders' equity | $ | 62,148 | $ | 54,570 | ||
Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) | ||||||
This Year | Last Year | |||||
Sales | $ | 97,000 | $ | 92,000 | ||
Cost of goods sold | 61,000 | 57,000 | ||||
Gross margin | 36,000 | 35,000 | ||||
Selling and administrative expenses: | ||||||
Selling expenses | 10,300 | 9,800 | ||||
Administrative expenses | 13,800 | 12,800 | ||||
Total selling and administrative expenses | 24,100 | 22,600 | ||||
Net operating income | 11,900 | 12,400 | ||||
Interest expense | 1,050 | 1,050 | ||||
Net income before taxes | 10,850 | 11,350 | ||||
Income taxes | 4,340 | 4,540 | ||||
Net income | 6,510 | 6,810 | ||||
Dividends to common stockholders | 392 | 784 | ||||
Net income added to retained earnings | 6,118 | 6,026 | ||||
Beginning retained earnings | 28,460 | 22,434 | ||||
Ending retained earnings | $ | 34,578 | $ | 28,460 | ||
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 answer to 2 decimal places.)
5. Book value per share. (Round your answer to 2 decimal places.)
Earnings per share?
Price earnings ratio?
Dividends payout ratio %?
Dividends yield ratio %?
Book value per share?
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