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    Weighted average common shares

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    The comparative statements of Villa Tool Company are presented below.
    VILLA TOOL COMPANY
    Income Statement
    For the Year Ended December 31

    2009 2008
    Net sales $1,818,500 $1,750,500
    Cost of goods sold 1,011,500
    996,000

    Gross profit 807,000 754,500
    Selling and administrative expense 516,000
    479,000

    Income from operations 291,000 275,500
    Other expenses and losses
    Interest expense 18,000
    14,000

    Income before income taxes 273,000 261,500
    Income tax expense 81,000
    77,000

    Net income $ 192,000
    $ 184,500

    VILLA TOOL COMPANY
    Balance Sheets
    December 31

    Assets 2009 2008
    Current assets
    Cash $ 60,100 $ 64,200
    Short-term investments 69,000 50,000
    Accounts receivable (net) 117,800 102,800
    Inventory 123,000
    115,500

    Total current assets 369,900
    332,500

    Plant assets (net) 600,300
    520,300

    Total assets $970,200
    $852,800

    Liabilities and Stockholders' Equity
    Current liabilities
    Accounts payable $160,000 $145,400
    Income taxes payable 43,500
    42,000

    Total current liabilities 203,500
    187,400

    Bonds payable 200,000
    200,000

    Total liabilities 403,500
    387,400

    Stockholders' equity
    Common stock ($5 par) 280,000 300,000
    Retained earnings 286,700
    165,400

    Total stockholders' equity 566,700
    465,400

    Total liabilities and stockholders' equity $970,200
    $852,800

    All sales were on account. The allowance for doubtful accounts was $3,200 on December 31, 2009, and $3,000 on December 31, 2008.

    Compute the following ratios for 2009. (Weighted average common shares in 2009 were 57,000.) (a) Earnings per share. (b) Return on common stockholders' equity. (c) Return on assets. (d) Current. (e) Acid-test. (f) Receivables turnover. (g) Inventory turnover. (h) Times interest earned. (i) Asset turnover. (j) Debt to total assets. (Round earnings per share, current ratio and acid-test ratio to 2 decimal places, e.g. 10.50. Round all other answers to 1 decimal place, e.g. 10.5.)

    (a) Earnings per share $
    (b) Return on common stockholders; equity %
    (c) Return on assets %
    (d) Current :1
    (e) Acid-test :1
    (f) Receivables turnover times
    (g) Inventory turnover times
    (h) Times interest earned times
    (i) Asset turnover times
    (j) Debt to total assets %

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    https://brainmass.com/business/business-math/weighted-average-common-shares-305573

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    Solution Summary

    Weighted average common shares are computed.

    $2.19

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