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. Kyan Company Barco Kyan Company Barco Company Data from the current year's income statement Company Data from the current year-end balance sheets $800,000 $882,200 648,500 11,000 24,355 Sales Assets $ 18,000 $ 35,000 595,100 9,000 15,377 180,523 Cash Cost of goods sold Interest expense Income tax expense Accounts receivable, net Merchandise inventory 40,400 85,040 5,500 54,400 134,500 Prepaid expenses 7,750 312,400 Net income 198,345 4. 20 Plant assets, net 320,000 Basic earnings per share 4.30 $468,940 $544,050 Total assets Cash dividends per share 3.72 3.99 Beginning-of-year balance sheet data Accounts receivable, net Merchandise inventory Liabilities and Equity $ 29,800 $ 57,200 53,600 $ 71,340 $ 91,300 Current liabilities 84,800 210,000 Long-term notes payable Common stock, $5 par value Retained earnings 103,000 236,000 113,750 111,400 392,500 Total assets 408,000 102,800 Common stock, $5 par value 236,000 210,000 $468,940 $544,050 Retained earnings Total liabilities and equity 103,733 78,517 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 company's stock can be purchased at $75 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 company's stock you would recommend as the better investment. 2A Prof Mar Ratio 2A Price Earn 2A Ret On 2A Tot Asset 2A Ret on Tot 2A Div Yield Req 2B Com Stock Turn Assets Ratio For both companies compute the profit margin ratio. Profit Margin Ratio (a) I Choose Denominator: Company Choose Numerator: Profit margin ratio %3D Profit margin ratio Barco %3D Kyan %3D 2A Ret On 2A Prof Mar 2A Ret on Tot 2A Tot Asset 2A Price Earn Req 2B 2A Div Yield Ratio Turn Assets Com Stock Ratio For both companies compute the total asset turnover (b) Total Asset Turnover = Total Asset Turnover I Choose Denominator: Company Choose Numerator: Total asset turnover %3D 0 times Barco %3D 0 times Kyan 2A Price Earn 2A Ret on Tot 2A Prof Mar 2A Tot Asset 2A Ret On 2A Div Yield Req 2B Turn Com Stock Ratio Assets Ratio For both companies compute the return on total assets. Return on Total Assets (c) I Choose Denominator: = Return on Total Assets Company Choose Numerator: Return on total assets Barco Kyan II 2A Prof Mar 2A Price Earn 2A Tot Asset 2A Ret on Tot 2A Ret On 2A Div Yield Req 2B Ratio Com Stock Ratio Turn Assets 2A Tot Asset Turn For both companies compute the return on common stockholders' equity. Return On Common Stockholders' Equity (d) Return On Common Stockholders' Equity Company Choose Numerator: Choose Denominator Return On common stockholders' equity Barco Kyan %3D 2A Ret On 2A Price Earn Ratio 2A Prof Mar 2A Tot Asset 2A Ret on Tot 2A Div Yield Req 2B Com Stock Ratio Turn Assets Assuming that share and each company's stock can be purchased at $75 per share, compute their price-earnings ratios. Price-Earnings Ratio (e) I Choose Denominator: = Price-Earnings Ratio = Price-earnings ratio Choose Numerator: Company 0 times Barco %3D 0 times Kyan 2A Price Earn Ratio 2A Prof Mar 2A Ret On 2A Ret on Tot 2A Tot Asset 2A Div Yield Req 2B Ratio Turn Assets Com Stock Assuming that each company's stock can be purchased at $75 per share, compute their dividend yields. (f) Dividend Yield I Choose Denominator: Choose Numerator: Company Dividend Yield Dividend yield Barco %3D Kyan 2A Price Earn 2A Prof Mar 2A Tot Asset 2A Ret on Tot 2A Ret On 2A Div Yield Req 2B Com Stock Ratio Turn Assets Ratio Identify which company's stock you would recommend as the better investment. The better investment