nep 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 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 $21. All of the company's sales are on account Weller Corporation Comparative Balance Sheet (dollars in thousands) Assets This Year Last Year Current assetas Cash Accounts receivable. net $1,270 $ 1,300 Inventory 9,200 7.900 Prepaid expenses 13,300 12,600 Total current assets 660 650 24, 430 Property and equipment Tand 10.700 10,700 Buildings and equipment, net 33,884 Total property and equipment 52,36) 40,584 Total asset 576, 793 567,034 Liabilities and Stockholders' Equity Current liabilities Accounts payable $20, 100 $10.200 Accrued liabilities 940 090 Notes payable, short term 190 190 Total current liabilities 21,230 19,200 Long-term liabilities Bonds payable 3.100 3.100 Total liabilities 29.330 22/330 Stockholders' equity Coomon stock 700 700 Additional paid in capital 4,000 4.000 4,700 Total paid-in capital 4.700 Retained earnings 42.763 34,934 Total stockholders' equity 47.463 39.654 $76,193 507039 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 $20,100 940 190 21,230 $18,200 890 190 19,280 8,100 29,330 8,100 27,380 700 4,000 4,700 42, 763 47,463 $76,793 700 4,000 4,700 34,954 39,654 $67,034 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales Cost of goods sold $72,000 $65,000 39,000 41.000 Grons margin 33.000 24,000 Selling and administrative expenses Selling expenses 11.500 10,300 Administrative expenses 5,800 6,400 Total selling and administrative expenses 18,300 16,200 Bet operating income 14,700 7,300 Interest expense 810 810 Net Income before taken 13,890 6,490 Income taxes 5.556 2.596 Bet income 2,334 3,894 Dividends to common stockholders 525 200 Het income added to retained earnings 7.09 3.614 Beginning retained earnings 34.954 Ending retained earnings 342.763 $34,354 faollars in thousands) This Year $72,000 39,000 33,000 Last Year $ 65,000 41,000 24,000 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 11,500 6,800 18,300 14,700 810 13,890 5,556 8,334 525 7,809 34,954 $42,763 10,300 6,400 16,700 7,300 810 6,490 2,596 3,894 280 3,614 31,340 $34,954 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