Summary Information from the financial statements of two companies competing in the same Industry follows. Barco...

 

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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 balance sheets Data from the current year's income statement Assets Sales $ 770,000 $ 920,200 Cash Accounts receivable, net $ 18,500 33,400 $ 32,000 Merchandise inventory 84,640 Total assets Prepaid expenses Plant assets, net Liabilities and Equity Current liabilities Long-term notes payable. Common stock, $5 par value Retained earnings 7,600 309,400 Basic earnings per share $ 461,640 $ 547,900 Cash dividends per share $ 62,340 82,800 180,000 136,500 $ 91,300 113,000 246,000 Accounts receivable, net Beginning-of-year balance sheet data Merchandise inventory Total assets 97,600 Total liabilities and equity $ 461,640 $ 547,900 Common stock, $5 par value Retained earnings 5,100 320,000 60,400 138,500 Cost of goods sold Interest expense Income tax expense Net income 594,100 636,500 8,100 15,000 14,800 25,404 153,000 243,296 4.25 4.95 3.76 3.91 $ 30,800 $ 55,200 55,600 111,400 448,000 412,500 180,000 246,000 118,860 46,676 Required: 1a. 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.) 1b. Identify the company you consider to be the better short-term credit risk. Complete this question by entering your answers in the tabs below. 1A Current 1A Acid Test Ratio Ratio 1A Acct Rec Turn 1A Invent 1A Days Sal in 1A Days Sal Turnover Inv 1B short term Uncol For both companies compute the current ratio. Company Barco Kyan Numerator: Current Ratio Denominator: = Current Ratio = Current ratio = to 1 = to 1 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 balance sheets Data from the current year's income statement Assets Sales $ 770,000 $ 920,200 Cash Accounts receivable, net $ 18,500 33,400 $ 32,000 Merchandise inventory 84,640 Total assets Prepaid expenses Plant assets, net Liabilities and Equity Current liabilities Long-term notes payable. Common stock, $5 par value Retained earnings 7,600 309,400 Basic earnings per share $ 461,640 $ 547,900 Cash dividends per share $ 62,340 82,800 180,000 136,500 $ 91,300 113,000 246,000 Accounts receivable, net Beginning-of-year balance sheet data Merchandise inventory Total assets 97,600 Total liabilities and equity $ 461,640 $ 547,900 Common stock, $5 par value Retained earnings 5,100 320,000 60,400 138,500 Cost of goods sold Interest expense Income tax expense Net income 594,100 636,500 8,100 15,000 14,800 25,404 153,000 243,296 4.25 4.95 3.76 3.91 $ 30,800 $ 55,200 55,600 111,400 448,000 412,500 180,000 246,000 118,860 46,676 Required: 1a. 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.) 1b. Identify the company you consider to be the better short-term credit risk. Complete this question by entering your answers in the tabs below. 1A Current 1A Acid Test Ratio Ratio 1A Acct Rec Turn 1A Invent 1A Days Sal in 1A Days Sal Turnover Inv 1B short term Uncol For both companies compute the current ratio. Company Barco Kyan Numerator: Current Ratio Denominator: = Current Ratio = Current ratio = to 1 = to 1