1. Compute the following ratios for both companies for the current year, and decide which company's stock better fits your investment strategy. a. Quick (acid-test) ratio b. Inventory turnover c. Days' sales in average receivables d. Debt ratio e. Times-interest-earned ratio f. Return on common stockholders' equity g. Earnings per share of common stock h. Price-earnings ratio Selected balance sheet and market price data at end of current year: Shop We-shop Current assets: Cash $ 31,000 $ 8,000 Short-term investments 37,000 12,000 169,000 190,000 10,000 187,000 209,000 11,000 Current receivables, net Inventories Prepaid expenses Total current assets 446,000 Total assets 975,000 Total current liabilities 361,000 418,000 934,000 340,000 687,000 30,000 Total liabilities 668,000 100,000 Preferred stock, 8%, $150 par Common stock, $1 par (100,000 shares) $5 par (15,000 shares) Total stockholders' equity Market price per share of common stock 75,000 247,000 307,000 7.32 $ $ 43.40 Selected balance sheet data at beginning of current year: Shop We-shop Balance sheet: Current receivables, net $ 143,000 $ 192,000 195,000 Inventories 204,000 Total assets 844,000 912,000 305,000 30,000 Long-term debt Preferred stock, 8%, $150 par Common stock, $1 par (100,000 shares) $5 par (15,000 shares) Total stockholders' equity 100,000 75,000 220,000 260,000 Selected income statement data for the current year: Net sales (all on credit) Cost of goods sold Income from operations Interest expense Net income Shop 596,000 $ 460,000 94,000 We-shop 522,000 389,000 76,000 11,000 35,000 61,000