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acid test ratio current ratio Summary information from the financial statements of two companies competing in the same industry follows. Data from the current year-end
acid test ratio current ratio Summary information from the financial statements of two companies competing in the same industry follows. Data from the current year-end balance sheets Assets Cash Accounts receivable, net 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 Barco Company Kyan Company \begin{tabular}{rr} & \\ $22,500 & $33,000 \\ 39,400 & 60,400 \\ 84,840 & 132,500 \\ 5,200 & 7,500 \\ 300,000 & 308,400 \\ \hline$451,940 & $541,800 \\ \hline \hline 71,340 & $92,300 \\ 78,800 & 117,000 \\ 200,000 & 236,000 \\ 101,800 & 96,500 \\ \hline$451,940 & $541,800 \\ \hline \hline \end{tabular} Data fro Sales Cost of Interest Income t Basic ea Cash divi Beginning Accounts Merchandi Total ass Common st Retained Barco Company Kyan Company Data from the current year's income statement Sales Cost of goods sold Interest expense Income tax expense Net income Basic earnings per share Cash dividends per share $790,000594,1007,90015,185172,815$997,200646,50014,00025,045221,655 Beginning-of-year balance sheet data Accounts receivable, net Merchandise inventory Total assets Common stock, $5 par value 4.32 4.70 Retained earnings $26,80055,600378,000200,00079,385$55,200115,400362,500236,00063,645 For both compacies compute the acid-test ratio
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