ercise 16-5 (Algo) Financial Ratios for Assessing Profitability [LO16-5] omparative financial statements for Weller Corporation, a merchandising company, for the year ending December 31 appear below. ne company did not issue any new common stock during the year. A total of 970,000 shares of common stock were outstanding. The terest 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 ear and $0.40 this year. The market value of the company's common stock at the end of this year was $26. All of the company's sales are on account. Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year 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 $3,302 $4,230 16,100 9, 100 10,550 8,880 1,970 2,440 31,922 24,650 7,700 7,700 20,900 20,700 28,600 28,400 $ 60,522 $ 53,050. $ 11,200 940 470 $9,150 1,550 470 12,610 11,170 7,500 20,110 7,500 10,670 12 i Saved Notes payable, short term 478 470 Total current liabilities 12,610 11,170 Long-term Liabilities: Bonds payable Total liabilities Stockholders' equity: Common stock Additional paid-in capital Total paid-in capital Retained earnings 7,500 7,500 20,110 18,670 970 978 5,050 5,050 6,020 6,020 34,392 28,360 Total stockholders' equity 40,412 34,380 Total liabilities and stockholders' equity $ 60,522 $ 53,050 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) Sales This Year $ 96,000 Cost of goods sold 60,500 Last Year $91,000 56,500 Gross margin 35,500 34,500 Selling and administrative expenses: Selling expenses 10,200 9,700 Administrative expenses 13,700 12,700 Total selling and administrative expenses 23,900 22,400 Net operating income 11,600 12,100 Interest expense 900 900 Net income before taxes 10,700 Income taxes 4,280 Net income Dividends to common stockholders Net income added to retained earnings Beginning retained earnings Ending retained earnings 6,420 388 6,032 28,360 $ 34,392 11,200 4,480 6,720 776 5,944 22,416 $ 28,360 Help 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 (i.e., 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 %