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 $ 18,000 $ 35,000 Accounts receivable, net 40,400 54,400 Merchandise inventory 85,040 134,500 Prepaid expenses 5,500 7,750 Plant assets, net 320,000 312,400 Total assets $ 468,940 $544,050 Barco Kyan Company Company Data from the current year's income statement Sales $800,000 $882,200 Cost of goods sold 595,100 648,500 Interest expense 9,000 11,000 Income tax expense 15,377 24,1355 Net income 180,523 198,345 Basic earnings per share 4.30 4.20 Cash dividends per share 3.99 3.72 Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings Total liabilities and equity $ 71,340 $ 91,300 84,800 103,000 210,000 236,000 102,800 113,750 $ 468,940 $544,050 Beginning-of-year balance sheet data Accounts receivable, net Merchandise inventory Total assets Common stock, $5 par value Retained earnings $ 29,800 $ 57,200 53,600 111,400 408,000 392,500 210,000 236,000 78,517 103,733 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 Currer 1A Invent Turnover Ratio 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) Company Choose Numerator: Current Ratio I Choose Denominator: Current Ratio Current ratio 0 to 1 Barco 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 1B short term For both companies compute the acid-test ratio. Acid-Test Ratio (b) Company Choose Numerator: Choose Denominator: + + Acid-Test Ratio Acid-test ratio oto 1 Barco + + Kyan + + oto 1 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 accounts (including notes) receivable turnover. Company Choose Numerator: Accounts Receivable Turnover I Choose Denominator: Accounts Receivable Turnover = Accounts receivable turnover Barco 0 times Kyan 0 times 1A Days Sal Uncol 1B short term 00 1A Current 1A Acid Test 1A Acct Rec 1A Invent 1A Days Sal in Ratio Ratio Turn Turnover Inv 1A Acct Rec Turn For both companies compute the inventury turnuvei. (d) Company Choose Numerator: Inventory Turnover 1 Choose Denominator: = Inventory Turnover Inventory turnover 0 times Barco Kyan 0 times 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) Company Choose Numerator: Days' Sales in Inventory I Choose Denominator: Days' Sales in Inventory = Days' sales in inventory o days 0 days Barco Kyan 1A Current Ratio 1A Acid Test Ratio 1A Acct Rec Turn 1A Invent Turnover 1A Days Sal in 1A Days Sal Uncol 1B short term Inv For both companies compute the days' sales uncollected. Days' Sales Uncollected 1 Choose Denominator: x Days Company Choose Numerator: = Days' Sales Uncollected = Days' sales uncollected 0 days 0 days Barco II Kyan III 1A Acid Test Ratio 1A Current Ratio 1A Acct Rec Turn | 1A Invent Turnover 1A Days Sal in 1A Days Sal Uncol 1B short term Iny Identify the company you consider to be the better short-term credit risk. Better short-term credit risk