23 Required information [The following information applies to the questions displayed below.) Summary information from the financial statements of two companies competing in the same industry follows. 20 points 8 02:00:48 Barco Kyan Company Company Data from the current year-end balance sheets Assets Cash $ 22,500 $ 37,000 Accounts receivable, net 39,400 54,400 Current notes receivable (trade) 9,800 8,600 Merchandise inventory 84,940 140,500 Prepaid expenses 5,500 7,650 Plant assets, net 310,000 309,400 Total assets $472,140 $557,550 Barco Kyan Company Company Data from the current year's income statement Sales $ 790,000 $906, 200 Cost of goods sold 592,100 648,500 Interest expense 8,400 13,000 Income tax expense 15,185 25,017 Net income 174,315 219,683 Basic earnings per share 5.13 5.09 Cash dividends per share 3.73 3.96 Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings Total liabilities and equity $ 68,340 $100,300 85,800 111,000 170,000 216,000 148,000 130,250 $ 472,140 $557,550 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 $ 56,200 0 57,600 111,400 378,000 412,500 170,000 216,000 100,505 81,639 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 (1) 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. 1A Current 1A Acid Test 1A Acct Rec Ratio Ratio Turn 1A Invent Turnover 1A Days Sal 1A Days Sal in Inv Uncol Reg 1B For both companies compute the current ratio. (a) Current Ratio Company Choose Numerator: Choose Denominator: Current Ratio Current ratio 0 to 1 0 to 1 Barco = Kyan / Complete this question by entering your answers in the tabs below. 1A Current Ratio 1A Acid Test 1A Acct Rec Ratio Turn 1A Invent Turnover 1A Days Sal 1A Days Sal in Inv Uncol Req 1B For both companies compute the acid-test ratio. (b) Acid-Test Ratio Company Choose Numerator: Choose Denominator: Acid-Test Ratio Acid-test ratio + + 1 Barco + + 0 to 1 Kyan + + 0 to 1 Complete this question by entering your answers in the tabs below. 1A Current Ratio 1A Acid Test 1A Acct Rec Ratio Turn 1A Invent Turnover 1A Days Sal 1A Days Sal in Inv Uncol Reg 1B For both companies compute the accounts (including notes) receivable turnover. (c) Choose Company Numerator: Accounts Receivable Turnover Accounts Receivable 1 Choose Denominator: Turnover = Accounts receivable turnover Barco o times / / Kyan = o times Complete this question by entering your answers in the tabs below. 1A Current Ratio 1A Acid Test 1A Acct Rec Ratio Turn 1A Invent Turnover 1A Days Sal 1A Days Sal in Inv Uncol Req 1B For both companies compute the inventory turnover. (d) Inventory Turnover Company Choose Numerator: 1 Choose Denominator: Inventory Turnover = Inventory turnover Barco o times Kyan 1 o times Complete this question by entering your answers in the tabs below. 1A Current Ratio 1A Acid Test 1A Acct Rec Ratio Turn 1A Invent Turnover 1A Days Sal 1A Days Sal in Inv Uncol Req 1B For both companies compute the days' sales in inventory. Days' Sales in Inventory. I Choose Denominator: Company Choose Numerator: Days = Days' Sales in Inventory = Days' sales in inventory o days Barco 1 1 Kyan 0 days Complete this question by entering your answers in the tabs below. 1A Current Ratio 1A Acid Test 1A Acct Rec Ratio Turn 1A Invent Turnover 1A Days Sal 1A Days Sal in Inv Uncol Req 1B For both companies compute the days' sales uncollected. (f) Days' Sales Uncollected CompanyChoose Numerator: 1 Choose Denominator: x Days = Days' Sales Uncollected Days' sales uncollected 1 1 Barco 0 days Kyan 1 0 days Complete this question by entering your answers in the tabs below. 1A Current Ratio 1A Acid Test 1A Acct Rec Ratio Turn 1A Invent Turnover 1A Days Sal 1A Days Sal in Inv Uncol Req 1B Identify the company you consider to be the better short-term credit risk. Better short-term credit risk