P 14-3 The following information is obtained from financial statements from two companies working in the same industry. Their operations and capacities are very similar. Both companies apply the same accounting policies and pay 40% income tax. Required: Determine which company is better: 1. from a bond investment viewpoint. 2. from a share investor's viewpoint. 3. from a long-term creditor's viewpoint. Write your suggestions and back them up with calculations. You may want to compute various ratios from the available information below. Company A Company B TL 492 9.712 TL 2.482 144.271 62.609 3.781 213.143 4.413 14.617 7 808 10.800 308.777 (226.449) 103.387 478 10.552 208.353 TL 421.496 269 4.736 (3.299) 126 1.839 TL 16.456 Assets Current Assets Cash and Banks Accounts Receivable (net) Inventories Other Current Assets Total Current Assets Long-term Assets Accounts Receivable (net) Investments Property, plant and Equipment Less: Acc. Dept. Construction in Process Intangible Assets Other Long-term Assets Total Long-term Assets Total Assets Liabilities and Shareholders' Equity Current Liabilities Bank Loans Accounts Payable Customer Advances Accrued Expenses Total Current Liabilities Long-term Liabilities Bonds Payable, due in 3 years, at 30% interest Other Long-term Liabilities Total Long-term Liabilities Share Capital (par TL 1) Additional Paid-in Capital Legal Reserves Retained Earnings Total Shareholders' Equity Total Liabilities and Shareholders Equity Dividends Declared (total) Market Price Per Share 13.450 17.604 4.907 14.024 49.985 7.747 3.112 31 2.400 13.290 182.726 11.536 194.262 60.000 41.240 487 487 1.378 442 157 6.446 69.563 177.249 TL 421.496 TL 49.000 702 2.679 TL 16.456 603 TL TL 1,95 TL 3,50