10 Required information Part 1 of 2 12 points [The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows. Cash Accounts receivable, net Barco Kyan Company Company Barco Kyan Company Company Data from the current year-end balance sheets Assets Data from the current year's income statement Sales 310,000 $ 21,000 $ 34,000 39,400 54,400 9,900 7,000 84,840 138,500 6,000 7,250 305,400 Cost of goods sold Interest expense Income tax expense $760,000 $886,200 587,100 638,500 7,500 14,608 11,000 Net income Basic earnings per share Cash dividends per share 150,792 3.97 24, 465 212,235 4.31 3.71 4.03 $471,140 $546,550 Current notes receivable (trade) Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings Total liabilities and equity $ 61,340 $101,300 83,800 101,000 190,000 246,000 136,000 98,250 $471,140 $546,550 Beginning-of-year balance sheet data Accounts receivable, net Current notes receivable (trade) Merchandise inventory Total assets Common stock, $5 par value Retained earnings $ 26,800 $ 54, 200 63,600 398,000 190,000 187, 400 412,500 246,000 126, 188 84,291 Required: 1a. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts (including notes) 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 better short-term credit risk. ! Required information 10 Part 1 of 2 10. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts (including notes) 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 better short-term credit risk. Complete this question by entering your answers in the tabs below. 12 points 1A Current 1A Acid Test Ratio Ratio 1A Acct Rec Turn 1A Invent 1A Days Sal in 1A Days Sal Turnover Inv Uncol Req 1B For both companies compute the current ratio. (a) Current Ratio Company Choose Numerator: / Choose Denominator: Barco Kyan Current Ratio Current ratio to 1 to 1 ! Required information 10 Part 1 of 2 1a. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts (including notes) 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 better short-term credit risk. Complete this question by entering your answers in the tabs below. 12 points 1A Current Ratio 1A Acid Test 1A Acct Rec Ratio Turn 1A Invent 1A Days Sal in 1A Days Sal Turnover Inv Uncol Req 1B For both companies compute the acid-test ratio. (b) Company + Barco + Kyan + Acid-Test Ratio Choose Numerator: Required information 10 Part 1 of 2 10. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts (including notes) receivable turnover, (d) inventory turnover, (e) days' sales in inventory, and ( days' sales uncollected. (Do not round intermediate calculations.) 1b. Identify the company you consider to be better short-term credit risk. Complete this question by entering your answers in the tabs below. 12 points 1A Current Ratio 1A Acid Test Ratio 1A Acct Rec Turn 1A Invent 1A Days Sal in 1A Days Sal Turnover Inv Uncol Req 1B For both companies compute the accounts (including notes) receivable turnover. (c) Accounts Receivable Turnover Company Choose Numerator: / Choose Denominator: Barco Kyan ' = Accounts Receivable Turnover = Accounts receivable turnover times times ! Required information 10 Part 1 of 2 10. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts (including notes) 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 better short-term credit risk. Complete this question by entering your answers in the tabs below. 12 points 1A Current Ratio 1A Acid Test 1A Acct Rec Ratio Turn 1A Invent 1A Days Sal in 1A Days Sal Turnover Inv Uncol Req 1B For both companies compute the inventory turnover. (d) Inventory Turnover Company Choose Numerator: / Choose Denominator: Barco Kyan = Inventory Turnover Inventory turnover = times times 10 Part 1 of 2 ! Required information 1a. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts (including notes) 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 better short-term credit risk. Complete this question by entering your answers in the tabs below. 12 points 1A Current Ratio 1A Acid Test Ratio 1A Acct Rec Turn 1A Invent 1A Days Sal in 1A Days Sal Turnover Inv Uncol Req 1B For both companies compute the days' sales in inventory. (e) Days' Sales in Inventory. Company Choose Numerator: / Choose Denominator: / Barco Kyan Required information 10 Part 1 of 2 1a. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts (including notes) 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 better short-term credit risk. 12 Complete this question by entering your answers in the tabs below. points 1A Current Ratio 1A Acid Test 1A Acct Rec Ratio Turn 1A Invent Turnover 1A Days Sal in Inv 1A Days Sal Uncol Req 1B For both companies compute the days' sales uncollected. (f) CompanyChoose Numerator: Barco Kyan 1 / Days' Sales Uncollected Choose Denominator: X Days Days' Sales Uncollected = Days' sales uncollected X = days X days 10 Part 1 of 2 Required information Required: 1a. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts (including notes) 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 better short-term credit risk. 12 points Complete this question by entering your answers in the tabs below. 1A Current 1A Acid Test 1A Acct Rec Ratio Ratio Turn 1A Invent 1A Days Sal in 1A Days Sal Turnover Inv Uncol Req 1B Identify the company you consider to be the better short-term credit risk. Better short-term credit risk