Exercise 16-2 (Algo) Financial Ratios for Assessing Liquidity (L016-2] 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 this year was $21. All of the company's sales are on account This Year Last Year $1,270 10,200 12,400 640 24,510 $ 1,270 7,200 11,900 640 21.010 Weller Corporation Comparative Balance Sheet (dollars in thousands) Assets Current assetst Canh Accounts receivable, net Inventory Prepaid expenses Total current assets Property and equipment: Land Buildings and equipment, net Total property and equipment Total asset Liabilities and Stockholders' Equity Current liabilities: Accounts payable Macrued liabilities Notes payable, short term Total current liabilities Long-term 11 abilities Honda payable Total liabilities Stockholders' equity: Common stock Additional paid-in capital Total paid-in capital Retained earnings Total stockholders' equity 9,400 42,434 56,034 $81,344 9,400 36,792 46.192 $67,202 $20,200 1.000 210 21, 410 $18,700 700 210 19,610 B. 800 30.210 0,400 28.410 600 4,000 4,600 46.534 51,134 600 4.000 4.600 34.192 38,792 $ 20,200 1,000 210 21,410 $18,700 700 210 19,610 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 8,800 30,210 8,800 28,410 600 4,000 4,600 46,534 51, 134 $81,344 600 4,000 4,600 34,192 38,792 $67,202 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $75,000 $65,000 Cost of goods sold 35,000 41,000 Gross margin 40,000 24,000 Selling and administrative expenses: Selling expenses 10, 700 11,000 Administrative expenses 7,100 6,800 Total selling and administrative expenses 17,800 17,800 Net operating income 22, 200 6,200 Interest expense 880 Net income before taxes 21,320 5,320 Income taxes 8,528 2,128 Net Income 12,792 3,192 Dividends to common stockholders 450 240 Net income added to retained earnings 12,342 2.952 Beginning retained earnings 34,192 11,240 Ending retained earnings $46,534 $34.192 880 Required: 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