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Summary information from the nancial statements of two companies competing in the same industry follows. Barco Kyan Barco Kyan Company Company Company Company Data from the current year-end balance sheets Data from the current year's income statement l Assets Sales $730,000 $331,200 Cash $ 22,000 $ 38,000 cost of goods sold 538,100 040,500 Accounts receivable, net 30,400 50,400 Interest expense 9,200 11,000 Current notes receivable (trade) 9,200 7,600 Income tax expense 14,992 24,027 Merchandise inventory 34,640 130,500 Net income 167,708 205,373 Prepaid expenses 5,700 7,050 Basic earnings per share 3.99 4.98 Plant assets, net 320,000 307,400 Cash dividends per share 3.70 4.02 Total assets $479,940 $548,950 ' Beginning-ofyear balance sheet data Liabilities and Equity Accounts receivable, net $ 28,800 $ 55,?00 Current liabilities $ 68,340 $ 95,300 Current notes receivable (trade) 0 0 Long-term notes payable 79,300 113,000 Merchandise inventory 65,600 105,l400 common stock, $5 par value 210,000 206,600 Total assets 448,000 402,500 Retained earnings 121, 800 134,650 Common stock, $5 par value 210,000 206,000 Total liabilities and equity $479,940 $540,950 Retained earnings 112,352 94,901 ' Problem 13-5 Part 1 Required: 1a. For both companies compute the (a) current ratio, (b) acidetest ratio. (c) accounts (including notes) receivable turnover, (0] inventory turnover, (e) days' sales in inventory, and (fl clays' sales uncollected. (Do not round intermediate calculations.) 1b. Identify the company you consider to be better shortterm credit risk. 1A Current 1A Acid Test 1A Acct Rec 1A Invent 1A Days Sal in 1A Days Sal Ratio Ratio Turn Turnover Inv Uncol Req 1B For both companies compute the current ratio. (a) Current Ratio Company Choose Numerator: 1 Choose Denominator: E Current Ratio = Current ratio Barco 0 to 1 Kyan 0 to 11A Current 1A Acid Test 1A Acct Rec 1A Invent 1A Days Sal in 1A Days Sal Ratio Ratio Turn Turnover Inv Uncol Req 1B For both companies compute the acid-test ratio. (b) Acid-Test Ratio Company Choose Numerator: Choose Denominator: = Acid-Test Ratio 1 Acid-test ratio Barco 0 to 1 Kyan 0 to 1