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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 930,000 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 this year was $24.50. All of the company’s sales are on account. Required: Compute the following financial data for this year to fill the table: A. Earnings per share. (Round your answer to 2 decimal places.) B. Price-earnings ratio. (Round your intermediate calculations and final answer to 2 decimal places.) C. Dividend payout ratio. (Round your intermediate calculations and final answer to 2 decimal places.) D. Dividend yield ratio. (Round your intermediate calculations and final answer to 2 decimal places.) E. Book value per share. (Round your answer to 2 decimal places.)

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 930,000 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 this year was $24.50. All of the company’s sales are on account. Required: Compute the following financial data for this year to fill the table: A. Earnings per share. (Round your answer to 2 decimal places.) B. Price-earnings ratio. (Round your intermediate calculations and final answer to 2 decimal places.) C. Dividend payout ratio. (Round your intermediate calculations and final answer to 2 decimal places.) D. Dividend yield ratio. (Round your intermediate calculations and final answer to 2 decimal places.) E. Book value per share. (Round your answer to 2 decimal places.)

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter7: Operating Assets
Section: Chapter Questions
Problem 81.2C
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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 930,000 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 this year was $24.50. All of the company’s sales are on account.

Required:

Compute the following financial data for this year to fill the table:

A. Earnings per share. (Round your answer to 2 decimal places.)

B. Price-earnings ratio. (Round your intermediate calculations and final answer to 2 decimal places.)

C. Dividend payout ratio. (Round your intermediate calculations and final answer to 2 decimal places.)

D. Dividend yield ratio. (Round your intermediate calculations and final answer to 2 decimal places.)

E. Book value per share. (Round your answer to 2 decimal places.)

Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year Assets Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Total current assets $ 4,038 15,700 10,350 1,930 32,018 $ 4,140 10,400 8,720 2,360 25,620 Property and equipment: Land Buildings and equipment, net Total property and equipment 7,300 20,500 27,800 $59,818 7,300 20,300 27,600 $53,220 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 $10,800 860 430 $ 8,950 1,350 430 10,730 12,090 8,750 20,840 8,750 19,480 930 4,850 5,780 33,198 38,978 930 4,850 5,780 27,960 33,740 $59,818 $53,220 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales Cost of goods sold Gross margin Selling and administrative $92,000 58,500 33,500 $87,000 54,500 32,500 expenses: Selling expenses Administrative expenses Total selling and administrative 9,800 13,300 9,300 12,300 23,100 21,600 expenses Net operating income Interest expense Net income before taxes Income taxes 10,400 1,050 9,350 3,740 10,900 1,050 9,850 3,940 5,910 744 5,610 372 Net income Dividends to common stockholders Net income added to retained 5,238 5,166 earnings Beginning retained earnings Ending retained earnings 27,960 $33,198 22,794 $27,960
Transcribed Image Text:Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year Assets Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Total current assets $ 4,038 15,700 10,350 1,930 32,018 $ 4,140 10,400 8,720 2,360 25,620 Property and equipment: Land Buildings and equipment, net Total property and equipment 7,300 20,500 27,800 $59,818 7,300 20,300 27,600 $53,220 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 $10,800 860 430 $ 8,950 1,350 430 10,730 12,090 8,750 20,840 8,750 19,480 930 4,850 5,780 33,198 38,978 930 4,850 5,780 27,960 33,740 $59,818 $53,220 Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales Cost of goods sold Gross margin Selling and administrative $92,000 58,500 33,500 $87,000 54,500 32,500 expenses: Selling expenses Administrative expenses Total selling and administrative 9,800 13,300 9,300 12,300 23,100 21,600 expenses Net operating income Interest expense Net income before taxes Income taxes 10,400 1,050 9,350 3,740 10,900 1,050 9,850 3,940 5,910 744 5,610 372 Net income Dividends to common stockholders Net income added to retained 5,238 5,166 earnings Beginning retained earnings Ending retained earnings 27,960 $33,198 22,794 $27,960
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 intermediate calculations and final answer to 2 decimal places.) 5. Book value per share. (Round your answer to 2 decimal places.) 1. Earnings per share 2. Price-earnings ratio 3. Dividend payout ratio % 4. Dividend yield ratio % 5. Book value per share
Transcribed Image Text: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 intermediate calculations and final answer to 2 decimal places.) 5. Book value per share. (Round your answer to 2 decimal places.) 1. Earnings per share 2. Price-earnings ratio 3. Dividend payout ratio % 4. Dividend yield ratio % 5. Book value per share
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