Exercise 14-2 Financial Ratios for Assessing Liquidity [LO14-2] 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 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 company's common stock at the end of the year was $28. All of the company's sales are on account Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 1,150 10,900 13,900 680 26,630 $ 1,340 6,900 11,600 570 20,410 10,800 44,010 54,810 $81,440 10,800 36,165 46,965 $67,375 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 $19,405 1,060 110 20,570 $18,400 700 110 19,210 8,000 28,570 8.000 27,210 500 4,000 4,500 48,370 52,870 $81,440 500 4,000 4,500 35,665 40,165 $67.375 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $75,000 $64,000 Cost of goods sold 34,000 38,000 Gross margin 41,000 26,000 Selling and administrative expenses : Selling expenses 11,500 10,000 Administrative expenses 6,900 6,700 Total selling and administrative expenses 18,400 16,700 Net operating income 22,6co. 9,300 Interest expense 800 800 Net income before taxes 21,800 8,500 Income taxes 8,720 3,400 Net income 13,080 5,100 Dividends to common stockholders 375 375 Net income added to retained earnings 12,705 4,725 Beginning retained earnings 35,665 30,940 Ending retained earnings $48,370 $35,665 Required: Compute the following financial data and ratios for this year: 1. Working capital. (Enter your answer in thousands.) 2. Current ratio. (Round your answer to 2 decimal places.) 3. Acid-test ratio. (Round your answer to 2 decimal places.) 1. Working capital 2. Current ratio 3. Acid-test ratio