Comparative financial statements for Weller Corporation, a merchandising company

Question

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 at the end of the year was $23. All of the company's sales are on account. Weller Corporation Comparative Balance Sheet dollars in thousands) This Year Last Year Assets Current assets $ 1,270 1,410 6,800 12,200 0,800 530 Cash Accounts receivable, net 10,200 Prepaid expenses 640 Total current assets 24,310 19,540 Property and equipment: Land Buildings and equipment, net 10,300 10,300 42,250 38,800 52,550 49,100 $76,860 $68,640 Total property and equipment Total assets Liabilities and Stockholders' Equity Current liabilities Accounts payable Accrued liabilities Notes payable, short term $19,400 $19,300 850 130 940 130 Total current liabilities Long-term liabilities: 20,470 20,280 9,000 29,470 29,280 Bonds payable 9,000 Total liabilities Stockholders' equity: Common stock Additional paid-in capital 700 4,000 700 4,000 4,700 4,700 Total paid-in capital Retained earnings 42,690 34,660 47,390 39,360 $76,860 $68,640 Total stockholders' equity Total liabilities and stockholders' equity

Explanation / Answer

1.

Accounts Receivables Turnover = Sales / Average Accounts Receivables

2.

Average Collection Period = 365 / Accounts Receivables Turnover

3.

Inventory Turnover = Cost of Goods Sold / Average Inventory

4.

Average Sale Period = 365 / Inventory Turnover

5.

Operating Cycle = Average Collection Period + Average Sale Period.

6.

Total Asset Turnover = Sales / ( Average Total Assets)

Accounts Receivables Turnover 8.9

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.