Required information Ratio analysis [The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows. Iroquois Company Percy Company Iroquois Company Percy Company Data from the current year-end Data from the current year's balance sheets income statement Assets Sales $770,000 Cash $ 19,000 $ 34,000 Cost of goods sold Accounts receivable, net 35,400 59,400 Interest expense 591,100 8,300 $ 922,200 638,500 12,000 Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings Total liabilities and equity $ 64,340 $ 104,300 84,800 190,000 135,200 5 474,340 $540,950 04,840 140,500 Income tax expense 14,800 25,459 5,100 7,650 Net income 155,800 246,241 330,000 307,400 Basic earnings per share 4.10 5.22 $474,340 $540,950 Cash dividends per share Beginning-of-year balance sheet 3.73 3.98 data Accounts receivable, net $31,800 $ 55,200 117,000 Merchandise inventory 57,600 113,400 236,000 Total assets 438,000 392,500 91,650 Common stock, $5 par value 190,000 236,000 Retained earnings 121,140 33,265 Ratio Analysis Problem 4 Ratio Analysis Problem 4 Required: 1a. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts receivable turnover, (d) inventory turnover, (e) days' sales in inventory, and () 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 1A Acid Test Ratio Ratio, 1A Acct Rec Turn 1A Invent Turnover 1A Days Sal in 1A Days Sal Inv Uncol 1B short term For both companies compute the current ratio. (a) Company Iroquois Percy Numerator: Current Ratio Denominator Current Ratio Current ratio 0 to 1 0 to 1 1A Comentano 1A Acid Test Ratio Ratio Analysis Problem 4 Required: 1a. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts receivable turnover, (d) inventory turnover, (e) days' sales in inventory, and (4) 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 1A Days Sal in 1A Days Sal Turnover Inv Uncol 18 short term For both companies compute the acid-test ratio. (b) Company Iroquois Percy Acid-Test Ratio Numerator: Denominator: Acid-Test Ratio Acid-test ratio 1A Current Ratio 1A Acct Rec Tum > 0 to 1 0101 Ratio Analysis Problem 4 Required: 1a. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts receivable turnover, (d) inventory turnover, (e) days' sales in inventory, and ( 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. Ratio 1A Current 1A Acid Test 1A Acct Rec Ratio Turn 1A Invent 1A Days Sal in 1A Days Sal Turnover Inv Uncol 18 short term For both companies compute the accounts (including notes) receivable turnover. (c) Company Numerator: Iroquois Percy Accounts Receivable Turnover Denominator: Accounts Receivable Turnover Accounts receivable turnover 0 times 0 times