Please Help soon!!!! Comparative financial statements for Weller Corporation, a
ID: 2472843 • Letter: P
Question
Please Help soon!!!!
Comparative financial statements for Weller Corporation, a merchandising company, for the fiscal year ending December 31 appear below. The company did not issue any new common stock during the year. A total of 500,000 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 $1.00 last year and $0.65 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 Cash Accounts receivable, net Inventory Prepaid expenses $ 1,190$ 1,410 8,500 13,400 11,900 590 9,100 740 Total current assets 24,430 22,400 Property and equipment: Land 10.600 10.600 Buildings and equipment, net Total property and equipment Total assets Liabilities and Stockholders' Equity 39,434 34,632 50,034 45,232 $74,464 $67,632 Current liabilities Accounts payable Accrued liabilities $19,300 $18,400 770 250 1,010 250 Notes payable, short term Total current liabilities Long-term liabilities 20,560 19,420 8,800 29,360 28,220 Bonds payable 8,800 Total liabilities Stockholders' equity: Common stock Additional paid-in capital 500 4,000 500 4,000 Total paid-in capital Retained earnings 4,500 4,500 40,604 34,912 45,104 39,412 $74,464 $67,632 Total stockholders'equity Total liabilities and stockholders' equity Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year $67,000 $65,000 SalesExplanation / Answer
1. Working capital = Current assets - Current liabilities = $ 24,430 - $ 20,560 = $ 3,870
2. Current ratio = Current Assets / Current Liabilities = $ 24,430 / $ 20,560 = 1.19 : 1
3. Acid test ratio = (Current Assets - Inventory - Prepaid Expenses) / Current Liabilities = $ 10,290 / $ 20,560 = 0.50