Required information Problem 13-5A (Static) Comparative ratio analysis LO P3 [The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows. Barco Company Kyan Company Barco Company Kyan Company Data from the current year-end Data from the current year's balance sheets income statement Assets Prepaid expenses Plant assets, net Total assets Cash $ 19,500 $ 34,000 Accounts receivable, net 46,500 64,600 Merchandise inventory 84,440 5,000 290,000 $ 445,440 $ 542,450 Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings $ 61,340 80,800 180,000 123,300 Merchandise inventory 206,000 Total assets 142,150 Total liabilities and equity $ 445,440 $ 542,450 Common stock, $5 par value Retained earnings 132,500 6,950 304,400 $ 93,300 101,000 Sales Cost of goods sold Interest expense Income tax expense Net income Basic earnings per share Cash dividends per share Beginning-of-year balance sheet data Accounts receivable, net $ 770,000 585,100 7,900 $ 880,200 632,500 13,000 14,800 24,300 162,200 4.51 210,400 5.11 3.81 3.93 $ 29,800 $ 54,200 55,600 107,400 398,000 382,500 180,000 206,000 98,300 93,600 Problem 13-5A (Static) Part 2 2a. For both companies compute the (a) profit margin ratio, (b) total asset turnover, (c) return on total assets, and (d) return on equity. Assuming that each company's stock can be purchased at $75 per share. compute their (e) price-earnings ratios and (f) dividend Complete this question by entering your answers in the tabs below. 2A Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On 2A Price Earn Ratio Turn Assets Equity For both companies compute the profit margin ratio. Ratio (a) Company Barco Kyan Profit Margin Ratio Numerator: 1 Denominator: 2A Div Yield Req 2B II = Profit margin ratio Profit margin ratio 0% 0% 2A Prof Mar Ratio 2A Tot Asset 2A Ret on Tot Turn Assets 2A Ret On 2A Price Earn Equity Ratio 2A Div Yield Req 2B For both companies compute the total asset turnover (b) Company Barco Kyan Numerator: Total Asset Turnover Denominator: = Total Asset Turnover = Total asset turnover = 0 times 0 times Turn 2A Prof Mar 2A Tot Asset 2A Ret on Tot Ratio Assets 2A Ret On 2A Price Earn Equity 2A Div Yield Ratio Req 2B For both companies compute the return on total assets. (c) Company Numerator: Barco Kyan Return on Total Assets Denominator: = Return on Total Assets = Return on total assets = 0% 0% < 2A Tot Asset Turn 2A Ret On Equity > 2A Prof Mar Ratio 2A Tot Asset 2A Ret on Tot Turn Assets 2A Ret On Equity 2A Price Earn Ratio 2A Div Yield Req 2B For both companies compute the return on equity. (d) Company Barco Kyan Numerator: 1 1 1 Return On Equity. Denominator = Return On Equity = Return on equity = = II II 0% 0% Turn 2A Prof Mar 2A Tot Asset 2A Ret on Tot Ratio Assets 2A Ret On 2A Price Earn Equity Ratio 2A Div Yield Req 2B Assuming that share and each company's stock can be purchased at $75 per share, compute their price-earnings rati (e) Company Numerator: 1 1 Price-Earnings Ratio Denominator: = Price-Earnings Ratio = Price-Earnings Ratio Barco Kyan 0 times 0 times 2A Prof Mar 2A Tot Asset 2A Ret on Tot Ratio Turn Assets 2A Ret On 2A Price Earn Equity Ratio 2A Div Yield Req 2B Assuming that each company's stock can be purchased at $75 per share, compute their dividend yields. (f) Company Barco Kyan Numerator: Dividend Yield I Denominator: = Dividend Yield 1 = Dividend Yield / = 0% 0