QSh Chapter 15 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year $79.000 $ 74,000 48,000 5,000 00 26,000 500 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 ...... 8,000 11,000 19,000 7,000 00 3.500 600 5.900 2,360 3,540 320 3,220 26,660 $ 29,880 Net income ........ Dividends to common stockholders Net income added to retained earnings Beginning retained earnings Ending retained earnings 600 6,400 2,560 3,840 600 3,240 23,420 $26,660 Required: Compute the following financial data and ratios for this year: 1. Working capital. Current ratio. 3. Acid-test ratio. 2. EXERCISE 15-3 Financial Ratios for Asset Management LO15-3 Refer to the data in Exercise 15-2 for Weller Corporation. Required: Compute the following financial data for this year: 1. Accounts receivable turnover. (Assume that all sales are on account.) 2. Average collection period. 3. Inventory turnover. 4. Average sale period. 5. Operating cycle 6. Total asset turnover. EXERCISE 15-4 Financial Ratios for Debt Management L015-4 Refer to the data in Exercise 15-2 for Weller Corporation. Required: Compute the following financial ratios for this year: 1. Times interest earned ratio. 2. Debt-to-equity ratio. 3. Equity multiplier EXERCISE 15-5 Financial Ratios for Assessing Profitability LO15-5 Refer to the data in Exercise 15-2 for Weller Required: QSh Chapter 15 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year $79.000 $ 74,000 48,000 5,000 00 26,000 500 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 ...... 8,000 11,000 19,000 7,000 00 3.500 600 5.900 2,360 3,540 320 3,220 26,660 $ 29,880 Net income ........ Dividends to common stockholders Net income added to retained earnings Beginning retained earnings Ending retained earnings 600 6,400 2,560 3,840 600 3,240 23,420 $26,660 Required: Compute the following financial data and ratios for this year: 1. Working capital. Current ratio. 3. Acid-test ratio. 2. EXERCISE 15-3 Financial Ratios for Asset Management LO15-3 Refer to the data in Exercise 15-2 for Weller Corporation. Required: Compute the following financial data for this year: 1. Accounts receivable turnover. (Assume that all sales are on account.) 2. Average collection period. 3. Inventory turnover. 4. Average sale period. 5. Operating cycle 6. Total asset turnover. EXERCISE 15-4 Financial Ratios for Debt Management L015-4 Refer to the data in Exercise 15-2 for Weller Corporation. Required: Compute the following financial ratios for this year: 1. Times interest earned ratio. 2. Debt-to-equity ratio. 3. Equity multiplier EXERCISE 15-5 Financial Ratios for Assessing Profitability LO15-5 Refer to the data in Exercise 15-2 for Weller Required: QSh Chapter 15 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year $79.000 $ 74,000 48,000 5,000 00 26,000 500 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 ...... 8,000 11,000 19,000 7,000 00 3.500 600 5.900 2,360 3,540 320 3,220 26,660 $ 29,880 Net income ........ Dividends to common stockholders Net income added to retained earnings Beginning retained earnings Ending retained earnings 600 6,400 2,560 3,840 600 3,240 23,420 $26,660 Required: Compute the following financial data and ratios for this year: 1. Working capital. Current ratio. 3. Acid-test ratio. 2. EXERCISE 15-3 Financial Ratios for Asset Management LO15-3 Refer to the data in Exercise 15-2 for Weller Corporation. Required: Compute the following financial data for this year: 1. Accounts receivable turnover. (Assume that all sales are on account.) 2. Average collection period. 3. Inventory turnover. 4. Average sale period. 5. Operating cycle 6. Total asset turnover. EXERCISE 15-4 Financial Ratios for Debt Management L015-4 Refer to the data in Exercise 15-2 for Weller Corporation. Required: Compute the following financial ratios for this year: 1. Times interest earned ratio. 2. Debt-to-equity ratio. 3. Equity multiplier EXERCISE 15-5 Financial Ratios for Assessing Profitability LO15-5 Refer to the data in Exercise 15-2 for Weller Required: Comparative financial statements for Weller Corporation, a merchandising company, for the year ding December 31 appear below. The company did not issue any new common stock during the F. A total of 800.000 shares of common stock were outstanding. The interest rate on the bond ble was the income tax rate was 40%, and the dividend per share of common stock was this year was ST of the company's sales are on account. SL 75 last year and 0.40 this year. The market value of the company's common stock at the end of dity LO15-2 EXERC Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year Assets Current assets: $ 1,280 $ 1,560 Cash Accounts receivable, net Inventory Prepaid expenses Total current assets 9.100 12,300 9,700 1,800 8,200 2,100 20,960 25,080 Property and equipment: Land Buildings and equipment, net Total property and equipment 6,000 19,200 6.000 19.000 25,200 $50,280 25,000 $45,960 Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Accrued liabilities Notes payable, short term Total current liabilities Long-term liabilities: Bonds payable $ 9,500 600 300 $ 8,300 700 300 9,300 10,400 5,000 5,000 15,400 14,300 Total liabilities 800 4,200 Stockholders' equity: Common stock Additional paid-in capital Total paid-in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity 800 4,200 5,000 29.880 34,880 $50,280 5,000 26,660 31,660 $45.960