Problem 1: Scenario: You are deciding whether to invest in one of two companies (but not both). Your choices are Company A (for Awesome) or 'Company B' (for Bold). Please see the comparative Income Statements & Balance Sheets for both companies below: CO A and con Income Statements Vi 1221 housands, except per share amox COA Co 353,000 $86,000 9 10 11 Net Sales 12 Costs & Expenses 13 Cost of Goods Sold Selling Expenses Admin Expenses Total Costs & Expenses 15 15 17 income from Operations 18 interest Expense 10 income before Interest & Takes 20 Income Tax Expense 21 Net Income 2 Corning Per Share 23 37.000 7.000 4000 $48.000 5.000 1400 10 1.800 1.800 51.0 61.000 10,000 5.000 $70,000 10.000 3.200 3800 1400 31400 $113 Problem 1-Ratio Anys Cost Volim Pole 0 ES CO A and Co B Balance Sheets 31-Dec-18 (In Thousands) COA COB Assets 26 27 28 29 30 31 32 33 Cash (current) 34 Accounts Receivable (current) 35 Inventory (current) 36 Property, Plant & Equipment (Neton-current) 37 Other Assets (non-current) 38 Total Assets 39 40 41 Accounts Payable (current) 42 Notes Payable (non current) 43 Bonds Payable (non current) 44 Common Stock, 51 par value 45 Additional Paid In Capital 46 Retained Earnings 47 Total Liabilities & Stockholder's Equity 48 $2,000 2,000 2,000 20,000 4,000 $30,000 $4,500 6,500 5,000 35,000 5.000 $56,000 abilities & Stockholder's Equ $2,500 1.500 10.000 1.000 9.000 6,000 $30,000 $3,000 4.000 30,000 3,000 9,000 7.000 556,000 Problem 1. Rabo Araly Problem 2-Cost Volume Profit Dw X Exam 3xlsx i le Edlist Format Hero VSA A D 49 50 Required. Using the Financial Ratios' sheet given to you in class, calculate the following 3 ratios for each company (please show your math) and state which co is more favor 51 5 (Show computations below, then use for 'B' for the boxes at the right) e Favorable' In this catec 5 For Company 'A' (Awesome): For Company 'B' (Bold): Current Ratio Prohit Margin Debt to Equity Ratio -> 57 Aore Favorable Overal Question: Which company is the more favorable overall choice (A or B?) O SPOINT BONUS: Explain why (5 sentences based on what we've learned in class about liquidity, profit, debt vs equity, etc): 61 54 00 70