| Data from The Current Year End Balance Sheets | | | Data from the current years income |
| Assets | | | Sales |
| Cash | $19,500 | $35,000 | Cost of Goods Sold |
| Accounts Receivable | $40,400 | $52,400 | Interest Expense |
| Merchandise Inventory | $84,940 | $132,500 | Income Tax Expense |
| Prepaid Expenses | $5,500 | $7,150 | Net Income |
| Plant Assets | $340,000 | $311,400 | Basic Earnings per Share |
| Total Assets | $490,340 | $538,450 | Cash Dividends Per Share |
| | | | |
| Liabilities and Equity | | | Beginning of Year Balance Sheet |
| Current Liabilities | $64,340 | $103,300 | Accounts Receivable, Net |
| Long-Term Notes Payable | $83,800 | $113,000 | Merchandise Inventory |
| Common Stock, $5 Par Value | $190,000 | $226,000 | Total Assets |
| Retained Earnings | $152,200 | $96,150 | Common Stock, $5 Par Value |
| Total Liabilities and Equity | $490,340 | $538,450 | Retained Earnings |
2a. For both companies compute the (a) profit margin ratio, (b) total asset turnover, (c) return on total assets, and (d) return on common stockholders equity. Assuming that each companys stock can be purchased at $95 per share, compute their (e) price-earnings ratios and (f) dividend yields. (Do not round intermediate calculations. Round your answers to 2 decimal places.) 2b. Identify which companys stock you would recommend as the better investment.
2A Prof Mar Ratio 2A Tot Asset 2A Ret on Tot Turn Assets 2A Ret On Com Stock 2A Price Earn Ratio 2A Div Yield Reg 2B For both companies compute the profit margin ratio. (a) Company Choose Numerator: Profit Margin Ratio | Choose Denominator: 1 Profit margin ratio = Profit margin ratio % Barco Kyan Turn 2A Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On 2A Price Earn 2A Div Yield Ratio Reg 2B Assets Ratio Com Stock For both companies compute the total asset turnover (b) Total Asset Turnover Company Choose Numerator: 1 Choose Denominator: Total Asset Turnover 1 = Total asset turnover Barco 1 times Kyan times ( 2A Prof Mar Ratio 2A Reton Tot Assets > 2A Price Earn Ratio 2A Div Yield Reg 2B 2A Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On Ratio Turn Assets Com Stock For both companies compute the return on total assets. (c) Return on Total Assets | Choose Denominator: Company Choose Numerator: = Return on Total Assets = Return on total assets 1 1 % Barco Kyan = % 2A Tot Asset Turn 2A Ret On Com Stock > 2A Prof Mar Ratio 2A Tot Asset 2A Ret on Tot Turn Assets 2A Ret On Com Stock 2A Price Earn Ratio 2A Div Yield Reg 28 For both companies compute the return on common stockholders' equity. (d) Return On Common Stockholders' Equity Company Choose Numerator: Choose Denominator 1 - Ret = Ret / Barco Kyan 1 Ratio Ratio ZA Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On 2A Price Earn 2A Div Yield Reg 2B Turn Assets Com Stock Assuming that each company's stock can be purchased at $95 per share, compute their dividend yields. ( Dividend Yield Company Choose Numerator: | Choose Denominator: Dividend Yield 1 Dividend yield Barco % Kyan % I Reg 2B 2A Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On 2A Price Earn 2A Div Yield Ratio Turn Assets Com Stock Ratio Identify which company's stock you would recommend as the better investment. The better investment 2A Prof Mar Ratio 2A Tot Asset 2A Ret on Tot Turn Assets 2A Ret On Com Stock 2A Price Earn Ratio 2A Div Yield Reg 2B For both companies compute the profit margin ratio. (a) Company Choose Numerator: Profit Margin Ratio | Choose Denominator: 1 Profit margin ratio = Profit margin ratio % Barco Kyan Turn 2A Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On 2A Price Earn 2A Div Yield Ratio Reg 2B Assets Ratio Com Stock For both companies compute the total asset turnover (b) Total Asset Turnover Company Choose Numerator: 1 Choose Denominator: Total Asset Turnover 1 = Total asset turnover Barco 1 times Kyan times ( 2A Prof Mar Ratio 2A Reton Tot Assets > 2A Price Earn Ratio 2A Div Yield Reg 2B 2A Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On Ratio Turn Assets Com Stock For both companies compute the return on total assets. (c) Return on Total Assets | Choose Denominator: Company Choose Numerator: = Return on Total Assets = Return on total assets 1 1 % Barco Kyan = % 2A Tot Asset Turn 2A Ret On Com Stock > 2A Prof Mar Ratio 2A Tot Asset 2A Ret on Tot Turn Assets 2A Ret On Com Stock 2A Price Earn Ratio 2A Div Yield Reg 28 For both companies compute the return on common stockholders' equity. (d) Return On Common Stockholders' Equity Company Choose Numerator: Choose Denominator 1 - Ret = Ret / Barco Kyan 1 Ratio Ratio ZA Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On 2A Price Earn 2A Div Yield Reg 2B Turn Assets Com Stock Assuming that each company's stock can be purchased at $95 per share, compute their dividend yields. ( Dividend Yield Company Choose Numerator: | Choose Denominator: Dividend Yield 1 Dividend yield Barco % Kyan % I Reg 2B 2A Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On 2A Price Earn 2A Div Yield Ratio Turn Assets Com Stock Ratio Identify which company's stock you would recommend as the better investment. The better investment
