Exercise 14-3 (Algo) Financial Ratios for Asset Management (LO14-3] 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 700,000 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 50 75 fast year and 50 40 this year. The market value of the company's common stock at the end of this year was $28. All of the company's sales are on account Wer Corporation Comparative Balance sheet (dollars in thousands) TY Assets Current assets Cach 52,200 Accounts receivable et 0,200 7. Inventory 13,400 11, Prepaid expenses 66 Total current sets 26,90 Property and equipment Land 10,20 10, tudi udelt.net 45, 525 Total property and equipment 7.225 Total 5 83,715 568.35 Liabilities and stockholdere quity Current liabilities: Accounts payable 538,70 $ 11,900 Accrued otties Hotet payable short term 15e 154 Total current abilities 39.90 Long terlibilities: Bonds payable 0.00 5. Total abilities Stockholders' equity Comon stock 20 Additional paid-in capital 4,00 4. Total paid-in capital 9.00 4,700 Metained and 48.35 34. Total stockholders' equity 53.655 3352 Total llities and stockholders' wity 1715 Lait S. 75.000 10,10 er Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Sales 375,120 Cact of poods sold Grosso Selling and administrative expenses Selling expenses 10.00 dentrative expenses Total wells and administrativt expenses Het aperating Income 23.95 Interest expense 90 Het Income before taxes 23.015 Incontes inco 13,00 Dividends to constanders 2 Net Income wided to retained earnings 13,529 Tegning retained earnings 38.036 Ending retained amnings 54,55 3:21 16. 2.700 7.610 3.134 4. 200 1.986 S. 5.06 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 2 decimal places) 6. Total asset tumover (Round your answer to 2 decimal places) 5. Accounts receivable tumover Exercise 14.4 (Algo) Financial Ratios for Debt Management (LO14-4] 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 50 40 this year. The market value of the company's common stock at the end of this year was $23. All of the company's sales are on account This Year Last Year $ 1.500 10,00 13.20 $ 3,50 6,100 12.5 21.610 10,700 34.44 er Cart Comparative Balance Sheet (dollars in the ans) Assets Current assets Cash Accounts receivable, net Inventory Prepaid expenses Total current sett Property and equipment Land Buldings and equipment, net Total property and equipment Total assets Liabilities and Stockholders' Equity Current abilities: Accounts payable Accrued abilities 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 Habilities and stockholders' equity 10,790 45 52.16 $7.00 $ 45,154 $19,20 SLO 517,00 250 20.10 13,66 20,760 . 27.260 2.000 5.000 2,000 5.000 5, 33270 3,272 $ 70,00 56,154 Last $ 64,000 42.00 22.000 eller Corporation Comparative Income Statement and Reconciliation [dollars in thousands) This year Sales $72.000 Cost of goods sold Gross margin 2.000 Selling and administrative expenses Selling expenses 13.100 Administrative expenses Total selling and administrative expense Het operating income Interest wwe Se Het Income before tas 17.660 Income taxes Net Inco 30,554 Dividends to common stockholders Net Income added to retained earnings 1234 Deginning retained earnings Ending retained earnings 563.270 10,10 5.50 17100 4,700 3.840 29 30.000 $ 39,90 Required: Compute the following financial ratios for this year 1 Times interest earned ratio 2 Debt-to-equity ratio 3. Equity multiplier For all requirements, round your answers to 2 decimal places) 1 Times steamed ratio 2. Do-equity ratio Comparative financial statements for Weller Corporation 8 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 this year was $23. All of the company's sales are on account Weller Corporation Comparative Balance Sheet (dollars in thousands This Year Et Year $1,100 10,400 13,200 650 25,350 $1.350 6.900 12,500 660 21, 410 10,700 41.96 52.660 $ 78,018 10.700 34.44 44,714 $ 66,154 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-tern Visbilities Bonds payable Total liabilities Stockholders' equity Comon stock Additional paid in capital Total paid in capital Retained earnings Total stockholders' equity Total abilities and stockholders' equity $ 19,200 9:40 0 20,140 $ 17,700 750 210 18,660 1.000 28.740 3,600 27,260 2.000 4,000 6.000 3278 49,278 5.78,018 2,000 4.000 6.000 3294 38,894 $ 56,154 Last Year 64,000 42.000 22000 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Sales $ 72,000 cost of coods sold 35.000 Gross margin 27.000 Selling and administrative penses Selling expenses 11.100 Administrative expenses 2.400 Total selling and administrative expenses 18.500 Net operating Incont 10,500 Interest expense et Income before taves 17,640 Income taxes 7,056 et income 10,584 Dividends to common stockholders 200 Net Income added to retained earnings 10,364 Beginning retained earnings 33 34 Endine retained earnings 5.43,278 10.00 5.300 17300 4.700 360 3.560 1.536 2.100 250 SOLO 5.32.004 Required: Compute the following financial ration for this year 1. Times Interest earned ratio 2 Debt-to-equity ratio 3. Equity multiplier Exercise 14-3 (Algo) Financial Ratios for Asset Management (LO14-3) 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 yeat A total of 700 000 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 50 40 this year. The market value of the company's common stock at the end of this year was 528 All of the company's sales are an account Weller Ceporation Comparative Balance Sheet (dollars in thousands This Year Later 5 1,230 9,200 11,400 660 24.490 $ 1,240 7.500 11.300 570 20.010 10,700 46.229 57.225 $81.715 10,700 3706 47 726 $ 68,350 Assets Current assets: Cash Accounts receivable, wet Inventory Prepaid expenses Total current assets Property and equipment Land Bulldings and equipment, net Total property and equipment Total assets Liabilities and Stockholders' Equity Current abilities: Accounts payable Accued liabilities Hotes payable, short ter Total current liabilities Loe te latilities Bonds payable Total liabilities Stockholders' equity Common stock Additional paid in capital Total paid in capital Betained earnings Total stockholders quity Total liabilities and stockholders' equity $15.700 910 150 19.760 $18.900 BO 150 19,930 3.900 28,660 0-900 28,830 200 3.000 4,700 2355 53,055 $ 81,715 700 3,000 4,700 520 39, 526 5.68.356 Last Year $65.000 20.000 25,000 eller Corporation Comparative Income Statement and Reconciliation (dollars in thousands This Year Sales 5.76.820 Cost of goods sold 35,15 Gross margin 41.005 Selling and administrative expensest Selling expenses 10,500 Administrative expenses 6.500 Total selling and administrative expenses 17,100 Net operating Income 23,905 Interest Expense 890 tiet Income before taxes 23,015 Income taxes 9,200 Het Income 13,609 Dividends to common stockholders 280 Het Income added to retained varnings 13,52 Beginning retained earnings 34,826 Endine retained earnings 5.48,355 10,100 5.200 16.200 5700 890 7,810 2.124 4.686 200 3.986 30 SLO 5 34,825 Required: Compute the following financial dato 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 sele 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 2 decimal places.) 6. Total asset turnover (Round your answer to 2 decimal places.)