. uncanny-1.: I 7 w 'u. w, Problem 13-5A Comparative ratio analysis LO A1. P3 [T he faffo wing information applies to the questions displayed befo w] Summary information from the nancial statements of two companies competing in the same industry follows. Barco Kyan Barco Kyan Company Company Company Company Data from the current year-end balance sheets Data from the current year's income statement Assets Sales s 770,000 $ 880.200 Cash $ 19,500 $ 34.000 Cost of goods sold 585.100 632.500 Accounts receivable. net 37.400 57,400 Interest expense 7.900 13.000 Current notes receivable (trade) 9,100 7.200 Income tax expense 14.800 24.300 Merchandise inventory 84.440 132,500 Net income 162.200 210.400 Prepaid expenses 5.000 6.950 Basic earnings per share 4.51 5.11 290.000 304.400 Plant assets. net Cash dividends per share 3.81 3.93 $ 445.440 $ 542.450 Total assets Beginning-ofyear balance sheet data Liabilities and Equity Accounts receivable. net 3; 29,800 $ 54.200 Current liabilities $ 61.340 $ 93,300 Current notes receivable (trade) 0 0 Long-term notes payable 80.800 101.000 Merchandise inventory 55.600 107.400 Common stock. $5 par value 180.000 206900 Total assets 393.000 382.500 Retained earnings 123.300 142.150 Common stock, $5 pr value 180.000 205-000 Total liabilities and equity $ 445'440 $ 542450 Retained earnings 99.300 93.600 Rafe ren C68 inancial Analysis (20 pts) x 6 9 C' ' (D ez'lo.mheducation.com/hm.tpx?_=0.9415654409139754_1496037029520 QlOIGG 3. value: 900 porrns Problem 13-5A Part1 anulnd: 1.1 For both compenles campma me (a) current ratio, (b) add-Mam mm, (2) accounts (lnoludlng noles) receivable rurrrwer, (a) irrvemry trimmer, (a) days' sales in irrverrmry, and (I) daya' sales uneollsctod. (Do nut mund rmrrrmrm- ulcuullons.) I = Current reo Baron I : lo 1 Kyln I = no 1 + + I Acid-033' ratio Baron + + I m 1 KW" + + I m 1 I = Amounts receivable turnover Baron I = times Kym I = times Required Irrforrrreon Financial Analysis (20 pts) 6 9 C' ' (D ez'io.mheducation.com/hm.tpx?_=0.9415654409139754_1496037029520 invenmry turnover limes Kym I rirrres Days' sales in invenioty days days Burco I x Kym I x I x = Days' sales uneoilaaad a-rco I x = days Kyln I x = days 1'2 Iaemiiy me company you consider to be me better aim-m credit risk. 0 Kyeneompany 0 Baron company Rmmiou oBook a Rmnml Financial Analy ( a C' l(Dezio.mheducation.com/hm.tpx?__o.9415654409139754_1496037029520 Q is" O I 6 Problem 13-5A Part 2 2.1 For both companies oumpute me (a) pmfll margin rallo. (l7) total asset mrnwor, (c) rerurn on halal assets, and (d) mum on common stockholders' squliy. Assuming me! share and eaon company's slack can be purarssod ar :15 per share, oompuna rnair (a) priceseamings rarius and (r) dividend yields (Do not round manual-u calcumlom. Round your mun-rs m 2 animal places.) le'll margin ralio Birco Kym Total asset mmavar Hmas B-rco Ky-n I = limes Ramm on local 959m: Elmo Kynn I ll * Relurn on milieu slodmoldars equily Barco - Financial Analysis (20 pts) 6 9 C' ' (D ez'io.mheducation.com/hm.tpx?_=0.9415654409139754_1496037029520 |""" r l x l i ll Ramrn on mmon umaiders' equily i B1 Frice-Eamings Ralio limes times BIND I Dividend Yield Blrco I 2.2 Identify which company's stock you would recommend as the bemer Investment. 0 Kyanwmpany o Baron company