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 910,000 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 $0.75 last year and $0.40 this year. The market value of the company’s common stock at the end of the year was $23.50. All of the company’s sales are on account.
Weller Corporation Comparative Balance Sheet (dollars in thousands) |
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This Year | Last Year | |||||
Assets | ||||||
Current assets: | ||||||
Cash | $ | 1,506 | $ | 1,720 | ||
Accounts receivable, net | 15,500 | 10,300 | ||||
Inventory | 10,250 | 8,640 | ||||
Prepaid expenses | 1,910 | 2,320 | ||||
Total current assets | 29,166 | 22,980 | ||||
Property and equipment: | ||||||
Land | 7,100 | 7,100 | ||||
Buildings and equipment, net | 20,300 | 20,100 | ||||
Total property and equipment | 27,400 | 27,200 | ||||
Total assets | $ | 56,566 | $ | 50,180 | ||
Liabilities and Stockholders' Equity | ||||||
Current liabilities: | ||||||
Accounts payable | $ | 10,600 | $ | 8,850 | ||
Accrued liabilities | 820 | 1,250 | ||||
Notes payable, short term | 410 | 410 | ||||
Total current liabilities | 11,830 | 10,510 | ||||
Long-term liabilities: | ||||||
Bonds payable | 6,250 | 6,250 | ||||
Total liabilities | 18,080 | 16,760 | ||||
Stockholders' equity: | ||||||
Common stock | 910 | 910 | ||||
Additional paid-in capital | 4,750 | 4,750 | ||||
Total paid-in capital | 5,660 | 5,660 | ||||
Retained earnings | 32,826 | 27,760 | ||||
Total stockholders' equity | 38,486 | 33,420 | ||||
Total liabilities and stockholders' equity | $ | 56,566 | $ | 50,180 | ||
Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) |
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This Year | Last Year | |||||
Sales | $ | 90,000 | $ | 85,000 | ||
Cost of goods sold | 57,500 | 53,500 | ||||
Gross margin | 32,500 | 31,500 | ||||
Selling and administrative expenses: | ||||||
Selling expenses | 9,600 | 9,100 | ||||
Administrative expenses | 13,100 | 12,100 | ||||
Total selling and administrative expenses | 22,700 | 21,200 | ||||
Net operating income | 9,800 | 10,300 | ||||
Interest expense | 750 | 750 | ||||
Net income before taxes | 9,050 | 9,550 | ||||
Income taxes | 3,620 | 3,820 | ||||
Net income | 5,430 | 5,730 | ||||
Dividends to common stockholders | 364 | 728 | ||||
Net income added to retained earnings | 5,066 | 5,002 | ||||
Beginning retained earnings | 27,760 | 22,758 | ||||
Ending retained earnings | $ | 32,826 | $ | 27,760 | ||
Required:
Compute the following financial data for this year:
1. Earnings per share. (Round your answer to 2 decimal places.)
2. Price-earnings ratio. (Round your intermediate calculations and final answer to 2 decimal places.)
3. Dividend payout ratio. (Round your intermediate calculations and final answer to 2 decimal places.)
4. Dividend yield ratio. (Round your answer to 2 decimal places.)
5. Book value per share. (Round your answer to 2 decimal places.)
1. | Earnings per share = ( Net income - Preferred dividend ) / Outstanding shares of common stock = ( 5430000 - 0 ) / 910000 | 5.97 |
2. | Price-earnings ratio = Market price per share / Earnings per share = 23.50 / 5.97 | 3.94 |
3. | Dividend payout ratio = Dividend per share / Earnings per share = 0.40 / 5.97 | 6.70% |
4. | Dividend yield ratio = Dividend per share / Market price per share = 0.40 / 23.50 | 1.70% |
5. | Book value per share = ( Total stockholder's equity - Preferred equity ) / Outstanding shares of common stock = ( 38486000 - 0 ) / 910000 | 42.29 |
Comparative financial statements for Weller Corporation, a merchandising company, for the year ending December 31 appear...
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 910,000 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 $0.75 last year and $0.40 this year. The market value of the company’s common stock at the...
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 810,000 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 $0.75 last year and $0.40 this year. The market value of the company’s common stock at the...
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 810,000 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 $0.75 last year and $0.40 this year. The market value of the company’s common stock at the...
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...
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 960,000 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 $0.75 last year and $0.40 this year. The market value of the company’s common stock at the...
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...
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 bonds, which were sold at their face value, was 10%. The income tax rate was 40% and the dividend per share of common stock was $0.40 this year. The market value of the company's common stock...
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 bonds, which were sold at their face value, was 10%. The income tax rate was 40% and the dividend per share of common stock was $0.40 this year. The market value of the company's common stock...
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...
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 870,000 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 $0.75 last year and $0.40 this year. The market value of the company’s common stock at the...