i Data Table Data Table ollowing data for the two companies. Selected balance sheet and market price data at end of current year: Selected balance sheet data at beginning of current year: Authority pends on the results of ratio analysis. Express Authority Express Current assets: Cash $ 42.000 $ 28,000 $ 7,000 13,000 145,000 $ 207,000 849,000 Short-term investments Current receivables, net Inventories 193,000 196,000 910.000 ders' equity, and ST -short-term.) 189,000 168,000 208,000 11.000 307.000 Balance sheet: Current receivables, net Inventories Total assets Long-term debt Preferred stock, 8%, $175 par Common stock, $1 par (100,000 shares) $5 par (15,000 shares) Total stockholders' equity 184,000 10,000 35,000 Prepaid expenses Total current assets 443,000 100.000 Total assets 972,000 363.000 417,000 932,000 337,000 75,000 216.000 262.000 671,000 687,000 35,000 Print Done Total current liabilities Total liabilities Preferred stock, 8%, S175 par Common stock, $1 par (100,000 shares) $5 par (15,000 shares) Total stockholders' equity Market price per share of common stock 100.000 Print 75,000 245.000 Done 301.000 7.56 $ $ 47.88 Print pach camnany ille a 365-day vaar Round intermediar calculations to the nearest whole numer X Roundur final answers in one decimal Done uestion. 3 Requirements th i Data Table - X ping data for the two companies. nd go Selected income statement data for the current year: is on the results of ratio analysis. Authority Express $ 608,000 $ 522,000 1. Compute the following ratios for both companies for the current year, and decide which company's stock better fits your investment strategy. a. Quick (acid-test) ratio b. Inventory turnover c. Days' sales in average receivables d. Debt ratio e. Times-interest-eamed ratio f. Return on common stockholders' equity g. Eamings per share of common stock h. Price-earnings ratio Net sales (all on credit) Cost of goods sold 456,000 94,000 equity, and ST = short-term.) Income from operations Interest expense Net income 390,000 68,000 14.000 63,000 37,000 Print Done Print Done 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 Authority Express c. Days' sales in average receivables Select the formula and then enter the amounts to calculate dave' sale in Averane receivable for each camnany ille a 365-day vaar Round intermediar calculations to the nearest whole number X Round vor final answers in one decimal Choose from any list or enter any number in the input fields and then continue to the next question. . 3 Assume that you are considering purchasing stock as an investment. You have narrowed the choice to either Authority Corporation stock or Express Company stock and have assembled the following data for the two companies. (Click the loon 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, als = 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 1 + s to calculate the inventory turnover for each company. (Round the ratios to two decimal places, X.XX.) Inventory turnover Authority Avg common equity Express ( Average daily sales Average Inventory b. Inventory turni Average receivables Select the formul Capital charge Cash Common shares o's Authority Cost of capital Express Cost of goods sold Current assets c. Days' sales in Current liabilities Select the formul Current receivables Choose from any Interest expense Inventories Long-term debt I nrin narah to calculate dava' sales in AvArAnA receivables for each camnany (LISA A 365-NAV VAAT Round intermediary calculations to the nearest whole number X Round your final anwar one decimal the input fields and then continue to the next question. . U Cost of capital Cost of goods sold Current assets Current liabilities Current receivables Interest expense Inventories Long-term debt Mkt price per share Net income Net sales ST investments - Total assets Total liabilities Total SE Assume that you are considering purchasing stock as an investment. You have narrowed the choice to either Authority Corporation stock or Express Company stock and have assembled the following data for the two companies. B (Click the loon to view the income statement data.) B (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. Assure that you have analyzed all other factors and that your decision depends on the results of ratio analysis. Read the requirements, 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 Authority Express d. Debt ratio Select the formula and then enter the amounts to calculate the debt ratio each company. (Enter the debt ratio in decimal form to two decimal places, X.XX.) Debt ratio Authority Express e. Times interest earned ratio Select the formula and then enter the amounts to calculate the times-interest-earned ratio for Express, (Round the ratio to one decimal place, X.X.) Times-interest-eamed ratio Assume that you are considering purchasing stock as an investment. You have narrowed the choice to either Authority Corporation stock or Express Company stock and have assembled the following data for the two companies. |(Click the icon to view the income statement data.) B (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. e. Times-interest-earned ratio Select the formula and then enter the amounts to calculate the times-interest-earned ratio for Express. (Round the ratio to one decimal place, X.X.) Times-interest-earned ratio Express . f. Return on common stockholders' equity Select the formula and then enter the amounts to calculate the return on common stockholders' equity (ROE) for each company. (Complete all answer boxes. If an account has a zero balance, enter a "0". Enter the ROE as a percentage rounded to the nearest one-tenth percent, X.X%.) ( ROE Authority ( % Express ): II % Assume that you are considering purchasing stock as an investment. You have narrowed the choice to either Authority Corporation stock or Express 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. Express g. Earnings per share of common stock Select the formula and then enter the amounts to calculate earnings per share (EPS) for each company. (Complete all answer boxes. If an account has a zero balance, enter a "0". Round EPS to two decimal places, XXX.) ) + EPS Authority ) + ) + Express h. Price eamings 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, X.X, as needed.) P/E ratio Authority Express Which company's stock better fits your investment strategy? The common stock of seems to fit the investment strategy better. Its price-earings ratio is . and C ext question. Express Company appears to be in slightly better shape than Authority Corporation Authority Corporation appears to be in slightly better shape than Express Company