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 $ 18,500 $ 34,000 Accounts receivable, net 38,400 55,400 Merchandise inventory 84,640 136,500 Prepaid expenses 5,800 7,250 Plant assets, net 290,000 305,400 Total assets $437,340 $538,550 Barco Kyan Company Company Data from the current year's income statement Sales $770,000 $887,200 Cost of goods sold 584,100 632,500 Interest expense 7,700 11,000 Income tax expense 14,800 24,493 Net income 163,400 219,207 Basic earnings per share 5.11 5.07 Cash dividends per share 3.74 3.97 Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings Total liabilities and equity $ 67,340 $101,300 85,800 103,000 160,000 216,000 124,200 118,250 $437,340 $538,550 Beginning-of-year balance sheet data Accounts receivable, net Merchandise inventory Total assets Common stock, $5 par value Retained earnings $ 26,800 $ 55,200 59,600 113,400 458,000 392,500 160,000 216,000 80,480 70,1547 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 $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 company's stock you would recommend as the better investment. 2A Prof Mar Ratio 2A Tot Asset Turn 2A Ret on Tot 2A Ret On Com 2A Price Earn Assets Stock Ratio 2A Div Yield Req 2B For both companies compute the profit margin ratio. (a) Company Choose Numerator: Net income Profit Margin Ratio 1 Choose Denominator: I Net sales = Profit margin ratio = Profit margin ratio Barco Kyan a uto a este esenta en yeni sa nu am a ouvert mana 2A Prof Mar Ratio 2A Tot Asset Turn 2A Ret on Tot 2A Ret On Com 2A Price Earn Assets Stock Ratio 2A Div Yield Req 2B For both companies compute the total asset turnover (b) Total Asset Turnover Company Choose Numerator: Net sales 1 Choose Denominator: 1 Average total assets = Total Asset Turnover = Total asset turnover 0 times times Barco Kyan 2A Prof Mar Ratio 2A Tot Asset | 2A Ret on Tot 2A Ret On Com 2A Price Earn Turn Assets Stock Ratio 2A Div Yield Req 2B For both companies compute the return on total assets. (c) Return on Total Assets Company Choose Numerator: Net income 1 Choose Denominator: 1 Average total assets Return on Total Assets Return on total assets 0 % 0 % Barco Kyan 2A Prof Mar Ratio 2A Tot Asset 2A Ret on Tot 2A Ret On Com 2A Price Earn Assets Stock Ratio 2A Div Yield Req 2B Turn For both companies compute the return on common stockholders' equity. (d) Company Return On Common Stockholders' Equity Choose Denominator 1 Average common stockholders' equity Choose Numerator: - Preferred dividends Return On Common Stockholders' Equity Net income Return On common stockholders' equity Barco Kyan 2A Prof Mar Ratio 2A Tot Asset Turn 2A Ret on Tot 2A Ret On Com 2A Price Earn Assets Stock Ratio 2A Div Yield Req 2B Assuming that share and each company's stock can be purchased at $80 per share, compute their price-earnings ratios. Company Choose Numerator: Market price per common share Price-Earnings Ratio I Choose Denominator: I Earnings per share = Price-Earnings Ratio Price-earnings ratio 0 times 0 times Barco Kyan 2A Prof Mar Ratio 2A Tot Asset Turn 2A Ret on Tot 2A Ret On Com 2A Price Earn Assets Stock Ratio 2A Div Yield Req 2B Assuming that each company's stock can be purchased at $80 per share, compute their dividend yields. (f) Company Choose Numerator: Annual cash dividends per share Dividend Yield | Choose Denominator: 1 Market price per share = Dividend Yield = Dividend yield Barco 10% Kyan 2A Prof Mar Ratio 2A Tot Asset 2A Ret on Tot 2A Ret On Com 2A Price Earn Assets Stock Ratio 2A Div Yield Req 2B Turn Identify which company's stock you would recommend as the better investment. The better investment Kyan company