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 810,000 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 $18.50. All of the companys sales are on account.
Weller Corporation Comparative Balance Sheet (dollars in thousands) This YearLast YearAssets Current assets: Cash$ 2,546$ 2,770Accounts receivable, net12,4009,150Inventory9,7508,240Prepaid expenses1,8102,120Total current assets26,50622,280Property and equipment: Land6,1006,100Buildings and equipment, net19,30019,100Total property and equipment25,40025,200Total assets$ 51,906$ 47,480Liabilities and Stockholders' Equity Current liabilities: Accounts payable$ 9,600$ 8,350Accrued liabilities620750Notes payable, short term310310Total current liabilities10,5309,410Long-term liabilities: Bonds payable6,2506,250Total liabilities16,78015,660Stockholders' equity: Common stock810810Additional paid-in capital4,2504,250Total paid-in capital5,0605,060Retained earnings30,06626,760Total stockholders' equity35,12631,820Total liabilities and stockholders' equity$ 51,906$ 47,480
Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This YearLast YearSales$ 80,000$ 75,000Cost of goods sold52,50048,500Gross margin27,50026,500Selling and administrative expenses: Selling expenses8,6008,100Administrative expenses12,10011,100Total selling and administrative expenses20,70019,200Net operating income6,8007,300Interest expense750750Net income before taxes6,0506,550Income taxes2,4202,620Net income3,6303,930Dividends to common stockholders324648Net income added to retained earnings3,3063,282Beginning retained earnings26,76023,478Ending retained earnings$ 30,066$ 26,760
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.)
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