Exercise 14-2 Financial Ratios for Assessing Liquidity [LO14-2] 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 the year was $28. All of the company's sales are on account Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 1,120 10,500 12,400 740 24,760 $ 1,290 8,200 12,500 500 22,490 9,500 47,012 56,512 $81,272 9,500 38,286 47,786 $70,276 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 $17,700 760 $19,600 920 180 20,700 180 18,640 9,400 30, 100 9,400 28,040 700 4,000 4,700 46, 472 51,172 $81,272 700 4,000 4,700 37,536 42,236 $70,276 Last Year $65,000 34,000 31,000 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Sales $ 74,000 Cost of goods sold 39,000 Gross margin 35,000 Selling and administrative expenses: Selling expenses 10,900 Administrative expenses 7,100 Total selling and administrative expenses 18,000 Net operating income 17,000 Interest expense 940 Net income before taxes 16,060 Income taxes 6,424 Net income 9,636 Dividends to common stockholders 700 Net income added to retained earnings 8,936 Beginning retained earnings 37,536 Ending retained earnings $ 46, 472 10,400 7,000 17,400 13,600 940 12,660 5,064 7,596 700 6,896 30, 640 $37,536 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.)