Barco Company	Kyan Company			Barco Company	Kyan Company
Data from the current year-end balance sheets				Data from the current year's incme statement
Assets				Sales	$780,000	$881,200
Cash	$18,500	$34,000		Cost of goods sold	584,100	648,500
Accounts receivable, net	36,400	54,400		Interest expense	14,992	24,327
Prepaid expenses	6,100	7,500		Net income	171,808	197,373
Plant assets, net	320,000	307,400		Basic earnings per share	5.37	5.04
Total assets	$466,040	$537,800		Cash dividends per share	3.80	3.95
Liabilities and Equity				Beginning-of-year balance sheet data
Current liabilities	$61,340	$93,300		Accounts receivable, net	$28,800	$56,200
Long-term notes payable	85,800	105,00		Merchandise inventory	57,600	107,400
Common stock, $5 par value	160,000	196,000		Total assets	448,000	392,500
Retained earnings	158,900	143,500		Common stock, $5 par value	160,000	196,000
Total liabilities and equity	$466,040	$537,800		Retained earnings	108,692	100,967

Required

1. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts receivable turnover, (d) inventory turnover, (e) days sales in inventory, and (f) days' sales uncollected. (Do not round intermediate calculations.)

2. ldentify the company you consider to be the better short-term credit risk.

Answer rating: 100% (QA)

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