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 $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 $24. All of the company's sales are on account. cumparative patance sncer (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 \begin{tabular}{rr} $1,150 & $1,310 \\ 9,400 & 8,400 \\ 13,000 & 11,200 \\ 630 & 650 \\ \hline 24,180 & 21,569 \\ \hline 9,200 & 9,200 \\ 52,183 & 42,067 \\ \hline 61,383 & 51,267 \\ \hline$85,563 & $72,827 \\ \hline \end{tabular} Liabilities and Stockholders' Equity Current liabilities: Accounts payable Accrued liabilities Notes payable, short term Total current liabilities \begin{tabular}{rr} $19,200 & $18,100 \\ 1,050 & 900 \\ 180 & 180 \\ \hline 20,430 & 19,180 \end{tabular} Long-term liabilities: Bonds payable Tota1 1iabilities \begin{tabular}{rr} 9,800 & 9,800 \\ \hline 30,230 & 28,980 \\ \hline \end{tabular} Stockholders' equity: Common stock Additional paid-in capital Total paid-in capital Retained earnings Total stockholders' equity Total 1iabilities and stockholders' equity \begin{tabular}{rr} 700 & 700 \\ 4,000 & 4,000 \\ \hline 4,700 & 4,700 \\ 50,633 & 39,147 \\ \hline 55,333 & 43,847 \\ \hline$85,563 & $72,827 \\ \hline \end{tabular} Weller Corporation Comparative Income Statement and Reconciliotion (dollars in thousands) Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses Administrative expenses Total selling and administrative expenses Net operating income Interest expense Net income before taxes Income taxes Net income Dividends to common stockholders Net income added to retained earnings Beginning retained earnings Ending retained earnings \begin{tabular}{rr} This Year & Last Year \\ $78,320 & $65,000 \\ 39,930 & 33,000 \\ \hline 38,390 & 32,060 \\ \hline & \\ 11,200 & 10,400 \\ 6,600 & 6,900 \\ \hline 17,800 & 17,300 \\ \hline 20,590 & 14,700 \\ 980 & 980 \\ \hline 19,610 & 13,720 \\ 7,844 & 5,488 \\ \hline 11,766 & 8,232 \\ 280 & 525 \\ \hline 11,486 & 7,797 \\ 39,147 & 31,440 \\ \hline$50,633 & $39,147 \\ \hline \end{tabular} 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 ploces.) 2. Average collection period: (Use 365 days in a year. Round your intermediate calculations and final answer to 2 decimal places.) 3. Inventory turnovet. (Round your answer to 2 decimal places.) 4. Average sale period. (Use 365 days in 6 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 ploces.)