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 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 company's common stock at the end of the year was $23. All of the company's sales are on account. Weller Corporation Comparative Balance Sheet (dollars in thousands ) This Year Last Year $ 1,120 9,200 13,100 660 24,080 $ 1,250 8,200 10,700 660 20,810 10,700 47,428 58,128 $82,208 10,700 37,024 47,724 $68,534 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 $19,900 1,070 270 21,240 $17,600 850 270 18,720 8,100 29,340 8,100 26,820 600 4,000 4,600 48,268 52,868 $82,208 600 4,000 4,600 37,114 41,714 $68,534 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $ 74,000 $ 65,000 Cost of goods sold 36,000 35,000 Gross margin 38,000 30,000 Selling and administrative expenses: Selling expenses 11,100 10,500 Administrative expenses 6,500 6,900 Total selling and administrative expenses 17,600 17,400 Net operating income 20,400 12,600 Interest expense 810 810 Net income before taxes 19,590 11,790 Income taxes 7,836 4,716 Net income 11,754 7,074 Dividends to common stockholders 600 600 Net income added to retained earnings 11,154 6,474 Beginning retained earnings 37,114 30, 640 Ending retained earnings $48,268 $37, 114 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