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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		$	911,200
Cash	$	19,000		$	34,000			Cost of goods sold		588,100			636,500
Accounts receivable, net		33,400			53,400			Interest expense		7,800			15,000
Merchandise inventory		84,340			134,500			Income tax expense		15,377			25,155
Prepaid expenses		5,200			7,050			Net income		188,723			234,545
Plant assets, net		300,000			304,400			Basic earnings per share		4.72			4.97
Total assets	$	441,940		$	533,350			Cash dividends per share		3.75			3.94
Liabilities and Equity								Beginning-of-year balance sheet data
Current liabilities	$	62,340		$	99,300			Accounts receivable, net	$	29,800		$	52,200
Long-term notes payable		81,800			101,000			Merchandise inventory		61,600			117,400
Common stock, $5 par value		200,000			236,000			Total assets		418,000			392,500
Retained earnings		97,800			97,050			Common stock, $5 par value		200,000			236,000
Total liabilities and equity	$	441,940		$	533,350			Retained earnings		59,077			48,473

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 companys stock can be purchased at $80 per share, compute their (e) price-earnings ratios and (f) dividend yields. (Do not round intermediate calculations. Round your answers to 2 decimal places.) 2b. Identify which companys stock you would recommend as the better investment.