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[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 Company	Kyan Company		Barco Company	Kyan Company
Data from the current year-end balance sheets			Data from the current years income statement
Assets			Sales	$ 800,000	$ 899,200
Cash	$ 22,000	$ 36,000	Cost of goods sold	594,100	640,500
Accounts receivable, net	35,400	51,400	Interest expense	8,500	19,000
Merchandise inventory	84,540	134,500	Income tax expense	15,377	24,824
Prepaid expenses	6,200	7,250	Net income	182,023	214,876
Plant assets, net	340,000	305,400	Basic earnings per share	4.55	4.75
Total assets	$ 488,140	$ 534,550	Cash dividends per share	3.79	3.93
Liabilities and Equity			Beginning-of-year balance sheet data
Current liabilities	$ 61,340	$ 95,300	Accounts receivable, net	$ 31,800	$ 53,200
Long-term notes payable	82,800	105,000	Merchandise inventory	59,600	107,400
Common stock, $5 par value	200,000	226,000	Total assets	428,000	402,500
Retained earnings	144,000	108,250	Common stock, $5 par value	200,000	226,000
Total liabilities and equity	$ 488,140	$ 534,550	Retained earnings	113,577	71,010

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 (f) days sales uncollected. (Do not round intermediate calculations.) 1b. Identify the company you consider to be the better short-term credit risk.

• 1A Current Ratio
• 1A Acid Test Ratio
• 1A Acct Rec Turn
• 1A Invent Turnover
• 1A Days Sal in Inv
• 1A Days Sal Uncol
• 1B short term

For both companies compute the current ratio.

(a)	Current Ratio
Company	Numerator:	/	Denominator:	=	Current Ratio
		/		=	Current ratio
Barco		/		=	0	to 1
Kyan		/		=	0	to 1