Exercise 14-5 (Algo) Financial Ratios for Assessing Profitability (L014-5) 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 880,000 shares of common stock were outstanding. The interest 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 year and $0.40 this year. The market value of the company's common stock at the end of this year was $22. All of the company's sales are on account Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 3,508 25,200 10,100 1,880 30.688 $4,340 10,150 8,520 2,260 25,270 6,800 20.000 26.800 5.57,488 6.800 19.800 26.600 $ 51,070 Assets Current assets Cash Accounts receivable, not Inventory Prepaid expenses Total current assets Property and equipment Land Buildings and equipment, net Total property and equipment Total Asset Liabilities and stockholders' quity Current liabilities Accounts payable Accrued liabilities Notes payable, short ter Total current liabilities Long-term liabilities Bonds payable Total liabilities Stockholderst equity Common stock Additional paid in capital Total poid-in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 10,300 760 J80 11,440 $ 0,700 1,100 380 10,180 8,750 20,190 3,250 101,930 880 4,600 5,480 31.018 37,298 $57.488 4.600 5,480 27.469 32,940 $ 51,070 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) 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 (1.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 45.71% % % % Required: Compute the following financial data for this year: 1. Earnings per share. (Round your answer to 2 decimal places.) 2. Price-earnings ratio. (Round your intermediate calculations and final answer to 2 decimal places.) 3. Dividend payout ratio (Round your intermediate calculations and final answer to 2 decimal places.) 4. Dividend yield ratio. (Round your intermediate calculations and final answer to 2 decimal places.) 5. Book value per share. (Round your answer to 2 decimal places.) 1. Earnings per share 2. Price-earnings ratio 3. Dividend payout ratio 4. Dividend yield ratio 5. Book value per share % % Exercise 14-5 (Algo) Financial Ratios for Assessing Profitability (L014-5) 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 880,000 shares of common stock were outstanding. The interest 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 year and $0.40 this year. The market value of the company's common stock at the end of this year was $22. All of the company's sales are on account Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 3,508 25,200 10,100 1,880 30.688 $4,340 10,150 8,520 2,260 25,270 6,800 20.000 26.800 5.57,488 6.800 19.800 26.600 $ 51,070 Assets Current assets Cash Accounts receivable, not Inventory Prepaid expenses Total current assets Property and equipment Land Buildings and equipment, net Total property and equipment Total Asset Liabilities and stockholders' quity Current liabilities Accounts payable Accrued liabilities Notes payable, short ter Total current liabilities Long-term liabilities Bonds payable Total liabilities Stockholderst equity Common stock Additional paid in capital Total poid-in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 10,300 760 J80 11,440 $ 0,700 1,100 380 10,180 8,750 20,190 3,250 101,930 880 4,600 5,480 31.018 37,298 $57.488 4.600 5,480 27.469 32,940 $ 51,070 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) 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 (1.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 45.71% % % % Required: Compute the following financial data for this year: 1. Earnings per share. (Round your answer to 2 decimal places.) 2. Price-earnings ratio. (Round your intermediate calculations and final answer to 2 decimal places.) 3. Dividend payout ratio (Round your intermediate calculations and final answer to 2 decimal places.) 4. Dividend yield ratio. (Round your intermediate calculations and final answer to 2 decimal places.) 5. Book value per share. (Round your answer to 2 decimal places.) 1. Earnings per share 2. Price-earnings ratio 3. Dividend payout ratio 4. Dividend yield ratio 5. Book value per share % %