Required information Problem 13-5A (Static) 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 $ 19,500 $ 34,000 Accounts receivable, net 46,500 64,600 Merchandise inventory B4, 440 132,500 Prepaid expenses 5,000 6,950 plant assets, net 290,000 304,400 05 $445,440 $542,450 Barco Kyan Company Company Data from the current year's income statement Sales $770,000 $880,200 Cost of goods sold 585, 100 632,500 Interest expense 7.900 13,000 Income tax expense 14,800 24,300 Not income 162,200 210.400 Basic earnings per share 4.51 5.11 Cash dividends per share 3.81 3.93 Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings Total liabilities and equity $ 61,340 $ 93,300 80,800 101,000 180,000 206,000 123,300 142,150 $445,440 $542,450 Beginning-of-year balance sheet data Accounts receivable, net Merchandise inventory Total assets Common stock, $5 par value Retained earnings $ 29,800 $ 54,200 55,600 107,400 398,000 382,500 180,000 206,000 98,300 93,500 Problem 13-5A (Static) Part 2 2a. For both companies compute the (a) profit margin ratio, (b) total asset turnover, (return on total assets, and (c) return on common stockholders' equity. Assuming that each company's stock can be purchased at $75 per share, compute their (e) price-earnings ratios and 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 Complete this question by entering your answers in the tabs below. ZA Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On 2A Price Earn 2A Div Yield Reg 28 Ratio Turn Assets Com Stock Ratio Assuming that share and each company's stock can be purchased at $75 per share, compute their price-earnings ratios. Company Choose Numerator: Market price per common share Barco Kyan Price:Earnings Ratio 1 Choose Denominator: Earnings per share 1 Price-Earnings etio Price-Earnings Ratio o times O times 2A Ret On Com Stock 2A Div Yield > Problem 13-5A (Static) Part 2 2a. For both companies compute the (a) profit margin ratio. (b) total asset turnover, (d) return on total assets, and (c) return on common stockholders' equity. Assuming that each company's stock can be purchased at $75 per share, compute their (e) price earnings ratios and (y 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 Complete this question by entering your answers in the tabs below. Reg 2B 2A Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On 2A Price Earn Ratio 2A Div Yield Turn Assets Com Stock Ratio Assuming that each company's stock can be purchased at $75 per share, compute their dividend yields. (9 Dividend Yield Company Choose Numerator: 1 Choose Denominator: Dividend Yield Dividend Yield Annual cash dividends per share Market price per share 0 % 1 Barco 0 % Kyan Problem 13-5A (Static) Part 1 Required: 1a. For both companies compute the (o) current ratio, (b) acid-test ratio, (c) accounts receivable turnover. (d) inventory turnover. (e) days sales in inventory, and (6 days' sales uncollected. (Do not round Intermediate calculations.) 1b. Identify the company you consider to be the better short-term credit risk. Complete this question by entering your answers in the tabs below. 1A Current Ratio 1A Acid Test 1A Acct Rec Ratio Turn 1A Invent Turnover 1A Days Satin 1A Days Sal Inv Uncal 18 short term For both companies compute the acid-test ratio. Acid-Test Ratio Acid-Test Ratio Acid-test ratio Choose Numerator: Short-term investments - Current receivables ib) Company Cash Barco $ Kyan $ Choose Denominator: Current liabilities $ 61,340 = $ 93,300 - ! 101 19,500 34.000 1 + 101