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 paya ble 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 the year was $21. All of the company's sales are on account. Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year Assets Current assets: $1,250 11,000 Cash 1,350 8,000 10,800 Accounts receivable, net Inventory Prepaid expenses 12,100 780 620 Total current assets 20,770 25,130 Property and equipment: Land 9,600 9,600 Buildings and equipment, net Total property and equipment 53,429 42,225 63,029 51,825 $88,159 $72,595 Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Accrued liabilities Notes payable, short term $20,400 1,050 $19,000 840 250 250 Total current liabilities 21,700 20,090 Long-term liabilities: Bonds payable 10,000 31,700 10,000 30,090 Total liabilities Stockholders' equity: Common stock Additional paid-in capital 500 500 4,000 4,000 Total paid-in capital Retained earnings Total stockholders' equity 4,500 4,500 38,005 42,505 51,959 ,459 $88,159 Total liabilities and stockholders equity $72,595 This Year Last Year Sales $85,500 $64,000 Cost of goods sold Gross margin 43,510 41,990 33,000 31,000 S and administrative expenses : 10,700 6,900 17,600 11,000 6,400 Administrative ex Total selling and administrative expenses Net operating income xpenses 17,400 13,400 24,590 1,000 Interest expense 1,000 Net income before taxes 23,590 12,400 Income taxes 9,436 4,960 Net income 14,154 7,440 Dividends to common stockholders 200 375 Net income added to retained earnings Beginning retained earnings 13,954 38,005 7,065 30,940 Ending retained earnings $51,959 $38,005 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 6. Total asset turnover. (Round your answer to 2 decimal places.) decimal places.) 1. Accounts receivable turnover 9,00 2. Average collection period 3. Inventory turnover 4.Average sale period 40.56 days 3,80 96.05 days 5 Operating cycle 136.61 days 6. Total asset turnover 0.53 |