Required information (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 $ 21,500 $ 37,000 Accounts receivable, net 34,400 50,400 Merchandise inventory 84,640 142,500 Prepaid expenses 5,700 7,200 Plant assets, net 290,000 308,400 Total assets $436,240 $545,500 Barco Kyan Company Company Data from the current year's income statement Sales $790,000 $882,200 Cost of goods sold 584,100 646,500 Interest expense 13,000 Income tax expense 15,185 24,355 Net income 182,715 198,345 Basic earnings per share 4.81 4.39 Cash dividends per share 3.97 8,000 3.71 Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings Total liabilities and equity $ 66,340 $ 99,300 83,800 113,000 190,000 226,000 96, 100 107, 200 $436, 240 $545,500 Beginning-of-year balance sheet data Accounts receivable, net Merchandise inventory Total assets Common stock, $5 par value Retained earnings $ 29,800 $ 52,200 55,600 113,400 388,000 412,500 190,000 54,365 88,299 226,000 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. 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. Current Ratio (a) Company Choose Numerator: | Choose Denominator: = Current Ratio / = Current ratio Barco II oto 1 Kyan 0 to 1 1A Current Ratio 1A Acid Test Ratio 1A Acct Rec Turn 1A Invent Turnover 1A Days Sal in Inv 1A Days Sal Uncol 1 B short term For both companies compute the inventory turnover. (d) Inventory Turnover Company Choose Numerator: Choose Denominator: = Inventory Turnover = Inventory turnover Barco = 0 times Kyan II 0 times 1A Acct Rec Turn 1A Days Sal in Inv 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 days' sales in inventory. (e) Days' Sales in Inventory. Company Choose Numerator: | Choose Denominator: Days / x = Days' Sales in Inventory = Days' sales in inventory 0 days 0 days Barco X = Kyan / II 1A Invent Turnover 1A Days Sal Uncol 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 days' sales uncollected. Days' Sales Uncollected (f) CompanyChoose Numerator: I Choose Denominator: Days = Days' Sales Uncollected = Days' sales uncollected / x Barco - 0 days Kyan / X 0 days 1A Days Sal in Inv 1B short term 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 Identify the company you consider to be the better short-term credit risk. Better short-term credit risk