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 600,000 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 companys common stock at the end of this year was $23. All of the companys sales are on account.
Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 1,210 9,700 14,000 610 25,520 $ 1,370 7,400 11,200 660 20,630 10,700 40,975 51,675 $77,195 10,700 35,004 45, 704 $ 66,334 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 $20,400 940 270 21,610 $17,900 700 270 18,870 8,600 30,210 8,600 27, 470 600 4,000 4,600 42,385 46,985 $77,195 600 4,000 4,600 34, 264 38,864 $ 66,334 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $ 79,515 $65,000 Cost of goods sold 46,620 41,000 Gross margin 32,895 24,000 Selling and administrative expenses : Selling expenses 11,300 10,400 Administrative expenses 6,800 6,200 Total selling and administrative expenses 18,100 16,600 Net operating income 14,795 7,400 Interest expense 000 860 860 Net income before taxes 6,540 Income taxes 5, 574 2,616 Net income 8,361 3,924 Dividends to common stockholders 240 300 Net income added to retained earnings 8, 121 3,624 Beginning retained earnings 34, 264 30, 640 Ending retained earnings $42,385 $34, 264 13,935 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
