Required information Problem 13-5A (Algo) Comparative ratio analysis LO P3 [The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows. Barco Kyan Company Company Data from the current year-end balance sheets Assets Cash $ 22,500 $ 35,000 Accounts receivable, net 35,400 59,400 Merchandise inventory 85, 040 134,500 Prepaid expenses 5,700 7,300 Plant assets, net 340,000 307,400 Total assets $488,640 $543, 600 Barco Kyan Company Company Data from the current year's income statement Sales $760,000 $911,200 Cost of goods sold 594,100 640,500 Interest expense 9,300 14,000 Income tax expense 14,608 25,155 Net income 141,992 231,545 Basic earnings per share 3.74 4.91 Cash dividends per share 3.81 4.02 Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings Total liabilities and equity $ 69,340 $ 91,300 82,800 117,000 190,000 236,000 146,500 $488,640 $543,600 Beginning-of-year balance sheet data Accounts receivable, net Merchandise inventory Total assets Common stock, $5 par value Retained earnings $ 32,800 $ 54,200 63,600 109,400 418,000 492,500 190,000 236,000 149, 288 57,499 99,300 2a. For both companies compute the (a) profit margin ratio, (b) total asset turnover, (c) return on total assets, and (c) return on common stockholders' equity. Assuming that each company's stock can be purchased at $95 per share, compute their (e) price-earnings ratios and (1 dividend yields. (Do not round intermediate calculations. Round your answers to 2 decimal places.) 2b. Identify which company's stock you would recommend as the better investment. Answer is not complete. Complete this question by entering your answers in the tabs below. 2A Prof Mar Ratio 2A Tot Asset Turn 2A Ret on Tot Assets 2A Ret On Com Stock 2A Price Earn Ratio 2A Div Yield Req 2B For both companies compute the profit margin ratio. (a Profit Margin Ratio Choose Denominator: Choose Numerator: Company 1 Profit margin ratio = Barco Profit margin ratio 0 % 0 % Kyan = Answer is not complete. Complete this question by entering your answers in the tabs below. 2A Prof Mar 2A Tot Asset 2A Ret on Tot Ratio Turn Assets 2A Ret On Com Stock 2A Price Earn 2A Div Yield Ratio Req 2B For both companies compute the total asset turnover Total Asset Turnover (b) Company Choose Numerator: Choose Denominator: 1 = Total Asset Turnover Total asset turnover 0 times 0 times / Barco Kyan 1 X Answer is not complete. Complete this question by entering your answers in the tabs below. 2A Prof Mar Ratio 2A Tot Asset Turn 2A Ret on Tot Assets 2A Ret On Com Stock 2A Price Earn Ratio 2A Div Yield Reg 2B For both companies compute the return on total assets. (c) Return on Total Assets Choose Denominator: Company Choose Numerator: 1 Return on Total Assets Return on total assets Barco / 0 % % Kyan 0 2A Prof Mar Ratio 2A Tot Asset Turn 2A Ret on Tot Assets 2A Ret On Com Stock 2A Price Earn Ratio 2A Div Yield Reg 2B For both companies compute the return on common stockholders' equity. (d) Return On Common Stockholders' Equity Company Choose Numerator: Choose Denominator = Return On Common Stockholders' Equity Return On common stockholders' equity Barco 0 % Kyan = 0 % 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 company's stock can be purchased at $95 per share, compute their (e) price-earnings ratios and (1) dividend yields. (Do not round intermediate calculations. Round your answers to 2 decimal places.) 2b. Identify which company's stock you would recommend as the better investment. Answer is not complete. Complete this question by entering your answers in the tabs below. 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 Assuming that share and each company's stock can be purchased at $95 per share, compute their price-earnings ratios. (e) Company Price-Earnings Ratio Choose Denominator: Choose Numerator: 7 = Price-Earnings Ratio Price-earnings ratio 0 times Barco Kyan 0 times 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 company's stock can be purchased at $95 per share, compute their (e) price-earnings ratios and (1) dividend yields. (Do not round intermediate calculations. Round your answers to 2 decimal places.) 2b. Identify which company's stock you would recommend as the better investment. Answer is not complete. Complete this question by entering your answers in the tabs below. 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 Assuming that each company's stock can be purchased at $95 per share, compute their dividend yields. (f) Company Dividend Yield Choose Denominator: Choose Numerator: 1 Dividend Yield Dividend yield 0 = % Barco Kyan 0 %