Case 2 Comparative financial statements for Weller Corporation for the fi scal year ending December 31 appear below. The company did not issue any new common or preferred stock during the year. A total of 800,000 shares of common stock were outstanding. The interest rate on the bond payable was 12%, the income tax rate was 40%, and the dividend per share of common stock was $0.25. The market value of the company's common stock at the end of the year was $18. All of the company's sales are on account. Use 365 days for the ratios. Weller Corporation Comparative Balance Sheet (dollara in thousands) Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year This Year Last Year Sales Cost of goods sold Gross margin Assets 79,000 74,000 Current assets: 52.000 27,000 48,000 Cash 1.280 12,300 9.700 1560 9,100 8,200 26,000 Accounts, receivable, net Selling and administrative expenses: Inventory Prepaid expenses Total current assets 1800 2,100 8.500 Selling expenses Administrative expenses Total selling & admin. expenses Net oper ating income Interest expense Net income before taxes Income taxes (40%) Net income Dividends to preferred stockholders Net income remaining for common stockholdert Dividend to common stockholders Net income added to retained earrings 8,000 25,080 20,960 12,000 20,500 6,500 11,000 19,000 7,000 Property and equipment 6,000 6,000 19,000 Land 600 600 5,900 Buildings and equipment, net Total property and equipment Total assets 19,200 6,400 25,200 50.20 25,000 2.360 3,540 2,560 3,840 400 3,440 45,960 120 Liabilities & Stockholders' Equity Current liabilities: Accounts payable Accrued payables Notes payable, short term 3,420 200 9.500 600 300 200 3.240 23,420 26.660 8,300 700 300 3,220 26,660 29,880 Retained earrings, beginning of the year Retained earnings, end of the year Total current liabilities Long-term liabilities 10,400 9,300 Bonds payable Total liabilities 5,000 5,000 15,400 14,300 Stockholders' equity Preferred stock 2,000 2.000 Common stock 800 800 Additional paid-in capital Total paid-in capital Retained Earnings Total stockholdere' equity Total liabilities & stockholders' equity 2,200 2,200 5,000 5,000 29,880 34,880 50,280 26.660 31.660 45,960