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Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) 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 Required: Required: Compute the following financial ratios for this year: 1. Times interest earned ratio. 2. Debt-to-equity ratio. 3. Equity multiplier. This Year $ 70,000 38,000 32,000 11,200 6,700 17,900 14,100 920 13,180 5,272 7,908 240 7,668 35,898 $ 43,566 (For all requirements, round your answers to 2 decimal places.) 1. Times interest earned ratio 2. Debt-to-equity ratio 3. Equity multiplier Last Year $ 66,000 39,000 27,000 10,100 6,300 16,400 10,600 920 9,680 3,872 5,808 450 5,358 30,540 $ 35,898

Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) 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 Required: Required: Compute the following financial ratios for this year: 1. Times interest earned ratio. 2. Debt-to-equity ratio. 3. Equity multiplier. This Year $ 70,000 38,000 32,000 11,200 6,700 17,900 14,100 920 13,180 5,272 7,908 240 7,668 35,898 $ 43,566 (For all requirements, round your answers to 2 decimal places.) 1. Times interest earned ratio 2. Debt-to-equity ratio 3. Equity multiplier Last Year $ 66,000 39,000 27,000 10,100 6,300 16,400 10,600 920 9,680 3,872 5,808 450 5,358 30,540 $ 35,898

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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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 600,000 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 $29. All of the company's sales are on account. 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 perty and cap 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 Weller Corporation Comparative Balance Sheet (dollars in thousands) Additional paid-in capital Total paid-in capital. Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Weller Corporation This Year $ 1,150 9,200 12,100 690 23,140 9,200 47,286 56,486 $ 79,626 Last Year $ 1,340 6,800 11,500 660 20,300 9,200 41,508 50,708 $ 71,008 9,200 47,286 56,486 $ 79,626 $ 19,900 960 0 20,860 9,200 30,060 2,000 4,000 6,000 43,566 49,566 $ 79,626 9,200 41,508 50,708 $ 71,008 $ 19,100 710 100 19,910 9,200 29,110 2,000 4,000 6,000 35,898 41,898 $ 71,008 |||
Transcribed Image Text: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 600,000 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 $29. All of the company's sales are on account. 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 perty and cap 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 Weller Corporation Comparative Balance Sheet (dollars in thousands) Additional paid-in capital Total paid-in capital. Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Weller Corporation This Year $ 1,150 9,200 12,100 690 23,140 9,200 47,286 56,486 $ 79,626 Last Year $ 1,340 6,800 11,500 660 20,300 9,200 41,508 50,708 $ 71,008 9,200 47,286 56,486 $ 79,626 $ 19,900 960 0 20,860 9,200 30,060 2,000 4,000 6,000 43,566 49,566 $ 79,626 9,200 41,508 50,708 $ 71,008 $ 19,100 710 100 19,910 9,200 29,110 2,000 4,000 6,000 35,898 41,898 $ 71,008 |||
Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) 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 Required: Required: Compute the following financial ratios for this year: 1. Times interest earned ratio. 2. Debt-to-equity ratio. 3. Equity multiplier. This Year $70,000 38,000 32,000 11,200 6,700 17,900 14,100 920 13,180 5,272 7,908 240 7,668 35,898 $ 43,566 (For all requirements, round your answers to 2 decimal places.) 1. Times interest earned ratio 2. Debt-to-equity ratio 3. Equity multiplier Last Year $ 66,000 39,000 27,000 10,100 6,300 16,400 10,600 920 9,680 3,872 5,808 450 5,358 30,540 $ 35,898
Transcribed Image Text:Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) 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 Required: Required: Compute the following financial ratios for this year: 1. Times interest earned ratio. 2. Debt-to-equity ratio. 3. Equity multiplier. This Year $70,000 38,000 32,000 11,200 6,700 17,900 14,100 920 13,180 5,272 7,908 240 7,668 35,898 $ 43,566 (For all requirements, round your answers to 2 decimal places.) 1. Times interest earned ratio 2. Debt-to-equity ratio 3. Equity multiplier Last Year $ 66,000 39,000 27,000 10,100 6,300 16,400 10,600 920 9,680 3,872 5,808 450 5,358 30,540 $ 35,898
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