Assume that you are considering purchasing stock as an investment. You have narrowed the choice to either Point Corporation stock or U-shop Company stock and have assembled the following data for the two companies. (Click the icon to view the income statement data.) Click the icon to view data at end of current year.) (Click the icon to view data at beginning of current year.) Your strategy is to invest in companies that have low price-earnings ratios but appear to be in good shape financially. Assume that you have analyzed all other factors and that your decision depends on the results of ratio analysis. Read the requirements. Requirement 1. Compute the ratios for both companies for the current year and decide which company's stock better fits your investment strategy. Begin by computing the ratios, starting with the quick (acid-test) ratio. (Abbreviations used: Avg. = average, Cash* = cash and cash equivalents, Mkt = market, o/s = outstanding, SE = stockholders' equity, and ST = short-term.) a. Quick (acid-test) ratio Select the formula and then enter the amounts to calculate the quick (acid-test) ratios. (Round the ratios to two decimal places, X.XX.) = Quick ratio + Point U-shop (L + b. Inventory turnover Select the formula and then enter the amounts to calculate the inventory turnover for each company. (Round the ratios to two decimal places, X.XX.) = Inventory turnover Point U-shop c. Days' sales in average receivables Select the formula and then enter the amounts to calculate days' sales in average receivables for each company. (Use a 365-day year. Round intermediary calculations to the nearest whole number, X. Round your final answers to one decimal place, X.X.) = Days' sales in average receivables Point U-shop d. Debt ratio h. Price-earnings ratio Select the formula and then enter the amounts to calculate the price-earnings (P/E) ratio for each company (Enter amounts in the formula to two decimal places, X.XX, but then round the P/E ratios to one decimal place, XX, as needed.) = P/E ratio Point U-shop Which company's stock better fits your investment strategy? The common stock of seems to fit the investment strategy better. Its price-earnings ratio is V, and Data Table - X Selected income statement data for the current year: Point Net sales (all on credit)................ $ Cost of goods sold. Income from operations ....... Interest expense... 597,000 $ 453,000 90,000 U-shop 525,000 390,000 77,000 17,000 38,000 Net income ......... 65,000 Print Done