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 500,000 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 $24. All of the company's sales are on account Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year $ 1,190 10,200 12,900 800 25,090 $ 1,300 7,600 11,400 620 20,920 9,800 46,010 55,810 $80,900 9,800 38,280 48,080 $69,000 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 $20,400 1,080 120 21,600 $17,700 870 120 18,690 9,000 30, 600 9,000 27,690 500 4,000 4,500 45,800 50, 300 $80,900 500 4,000 4,500 36,810 41,310 $69,000 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $72,000 $65,000 Cost of goods sold 38,000 37,000 Gross margin 34,000 28,000 Selling and administrative expenses: Selling expenses 11,100 10,900 Administrative expenses 6,600 7,000 Total selling and administrative expenses 17,700 17,900 Net operating income 16,300 10, 100 Interest expense 900 900 Net income before taxes 15,400 9,200 Income taxes 6,160 3,680 Net income 9,240 5,520 Dividends to common stockholders 250 250 Net income added to retained earnings 8,990 5,270 Beginning retained earnings 36,810 31,540 Ending retained earnings $45,800 $36,810 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