Exercise 14-5 (Static) Financial Ratios for Assessing Profitability [LO14-5] Comparative financial statements for Weller Corporation, a merchandising company, for the year ending December 3 The company did not issue any new common stock during the year. A total of 800,000 shares of common stock were interest rate on the bond payable was 12%, the income tax rate was 40%, and the dividend per share of common stoc year and $0.40 this year. The arket value of the company's common stock at the end of this year was $18. All of the are on account. Weller Corporation Comparative Balance Sheet (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 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 Weller Corporation $ 1,280 $ 1,560 12,300 9,100 9,700 8,200 1,800 2,100 25,080 20,960 6,000 6,000 19,200 19,000 25,200 25,000 $ 50,280 $ 45,960 $ 9,500 $ 8,300 600. 700 300 300 10,400 9,300 5,000 5,000 15,400 14,300 800. 800 4,200 4,200 5,000 5,000 29,880 26,660 34,880 31,660 $ 50,280 $ 45,960 Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Stockholders' equity: Common stock Additional paid-in capital Total paid-in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Sales Weller Corporation 800 800 4,200 4,200 5,000 5,000 29,880 26,660 34,880 31,660 $ 50,280 $ 45,960 Comparat Income Statement and Reconciliation (dollars in thousands) This Year Last Year $ 79,000 $ 74,000 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 Required: Compute the following financial data for this year: 52,000 48,000 27,000 26,000 8,500 8,000 12,000 11,000 20,500 19,000 6,500 7,000 600 600 5,900 6,400 2,360 2,560 3,540 3,840 320 600 3,220 26,660 3,240 23,420 $ 29,880 $ 26,660 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 (i.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 % % % %