Data table Selected income statement data for the current year: Better Digital Very Zone Net Sales Revenue (all on credit) $ 418,290 $ 493,115 Cost of Goods Sold Interest Expense Net Income 206,000 255,000 0 19,000 50,000 76,000 Print Done - Selected balance sheet and market price data at the end of the current year: Better Digital Very Zone Current Assets: Cash $ 28,000 $ 21,000 Short-term Investments 39,000 18,000 Accounts Receivables, Net 37,000 48,000 Merchandise Inventory 66,000 100,000 Prepaid Expenses 21,000 16,000 $ 191,000 $ 203,000 Total Current Assets Total Assets $ 262,000 $ 325,000 Total Current Liabilities 102,000 95,000 Total Liabilities 102,000 133,000 Common Stock: $1 par (10,000 shares) 10,000 $2 par (17,000 shares) 34,000 Total Stockholders' Equity 160,000 192,000 Market Price per Share of Common Stock 75.00 98.34 Dividends Paid per Common Share 1.20 0.80 Selected balance sheet data at the beginning of the current year: Balance sheet: Accounts Receivables, net Merchandise Inventory Total Assets Better Digital Very Zone 40,000 $ 52,000 84,000 90,000 257,000 276,000 Cash Short-term Investments Accounts Receivables, Net Merchandise Inventory Prepaid Expenses Total Current Assets Total Assets Total Current Liabilities Total Liabilities Common Stock: GA 69 28,000 $ 21,000 39,000 18,000 37,000 48,000 66,000 100,000 21,000 16,000 191,000 $ 203,000 262,000 $ 325,000 102,000 95,000 102,000 133,000 $1 par (10,000 shares) 10,000 $2 par (17,000 shares) 34,000 Total Stockholders' Equity 160,000 192,000 Market Price per Share of Common Stock 75.00 98.34 Dividends Paid per Common Share 1.20 0.80 Better Digital Very Zone Selected balance sheet data at the beginning of the current year: Balance sheet: Accounts Receivables, net $ 40,000 $ 52,000 Merchandise Inventory 84,000 90,000 Total Assets 257,000 276,000 Common Stock: $1 par (10,000 shares) 10,000 $2 par (17,000 shares) 34,000 Assume that you are purchasing an investment and have decided to invest in a company in the digital phone business. You have narrowed the choice to Better Digital Corp. and Very Zone, Inc. and have assembled the following data. (Click to view the income statement data.) (Click to view the balance sheet and market price data.) Your strategy is to invest in companies that have low price/earnings ratios but appear to be in good shape financially. Assume that you have analyzed all other factors and that your decision depends on the results of ratio analysis. Read the requirements. Requirement 1a. Compute the acid-test ratio for both companies for the current year. Begin by selecting the formula to compute the acid-test ratio. Acid-test ratio Now, compute the acid-test ratio for both companies. (Round your answers to two decimal places, X.XX.) Better Digital Very Zone Acid-test ratio Requirement 1b. Compute the inventory turnover for both companies for the current year. Begin by selecting the formula to compute the inventory turnover. Inventory turnover = Now, compute the inventory turnover for both companies. (Round your answers to two decimal places, X.XX.) Better Digital Very Zone C Inventory turnover Requirement 1c. Compute the days' sales in receivables for both companies for the current year. Begin by selecting the formula to compute the days' sales in receivable. Days' sales in receivables == Now, compute the days' sales in receivables for both companies. (Round interim calculations to two decimal places and your final answers to the nearest whole day.) Days' sales in receivables Better Digital Very Zone Begin by selecting the formula to compute the debt ratio. Debt ratio Now, compute the debt ratio for both companies. (Round your answers to the one tenth of a percent, XX%.) Debt ratio Better Digital % Very Zone % Requirement 1e. Compute the earnings per share of common stock for both companies for the current year. Begin by selecting the formula to compute the earnings per share of common stock. Earnings per share of common stock Now, compute the earnings per share of common stock for both companies. (Round your answers to the nearest cent.) Better Digital Very Zone Earnings per share of common stock Requirement 1f. Compute the price/earnings ratio for both companies for the current year. Begin by selecting the formula to compute the price/earnings ratio. Price/earnings ratio Now, compute the price/earnings ratio for both companies. (Round interim and final answers to two decimal places, X.XX.) Price/earnings ratio Better Digital Very Zone Begin by selecting the formula to compute the earnings per share of common stock. Earnings per share of common stock Now, compute the earnings per share of common stock for both companies. (Round your answers to the nearest cent.) Better Digital Very Zone Earnings per share of common stock Requirement 1f. Compute the price/earnings ratio for both companies for the current year. Begin by selecting the formula to compute the price/earnings ratio. Price/earnings ratio Now, compute the price/earnings ratio for both companies. (Round interim and final answers to two decimal places, X.XX.) Better Digital Very Zone Price/earnings ratio Requirement 1g. Compute the dividend payout for both companies for the current year. Begin by selecting the formula to compute the dividend payout. Dividend payout Now, compute the dividend payout for both companies. (Round interim answers to two decimal places, XXX, and your final answers to the nearest whole percent, X%.) Dividend payout Better Digital % Very Zone % Requirement 2. Decide which company's stock better fits your investments strategy. common stock seems to fit the investment strategy better. Its price/earnings ratio is and On the majority of the ratios