Presented below is financial analysis data for two companies that are identical in every respect except that company X uses FIFO method to value its inventory, and company Z uses the LIFO method to evaluate its inventory.

Using this data, calculate the following ratios;

1. Return on Sales
2. Inventory turnover
3. Inventory on hand period
4. Current Ratio

Which of the two companies is a better investment opportunity and why?

	Company X	Company Z
Sales	$110,000	$110,000
Cost of Goods Sold	$49,500	$60,000
Net Income	$27,750	$17,250
Inventory	$21,000	$10,500
Current Assets	$64,000	$53,500
Current Liabilities	$22,000	$22,000