Return to question 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 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings Total liabilities and equity $ 19,500 $ 34,000 46,500 64,600 84,440 132,500 5,000 6,950 290,000 304,400 $ 445,440 $ 542,450 Data from the current year's income statement Sales Cost of goods sold Interest expense Income tax expense Net income Basic earnings per share Cash dividends per share Beginning-of-year balance sheet data Accounts receivable, net Merchandise inventory Total assets Common stock, $5 par value Retained earnings $ 770,000 $ 880,200 585,100 632,500 7,900 13,000 14,800 24,300 162,200 210,400 4.51 5.11 3.81 3.93 $ 61, 340 80,800 180,000 123, 300 $ 445, 440 $ 93,300 101,000 206,000 142, 150 $ 542,450 $ 29,800 55,600 398,000 180,000 98,300 $ 54,200 107,400 382,500 206,000 93,600 2a. For both companies compute the (a) profit margin ratio, (b) total asset turnover, (c) return on total assets, and (d) return on equity. Assuming that each company's stock can be purchased at $75 per share, compute their (e) price-earnings ratios and (1) dividend yields. 2b. Identify which company's stock you would recommend as the better investment. Return to question , ) - yields. 2b. Identify which company's stock you would recommend as the better investment. X Answer is not complete. Complete this question by entering your answers in the tabs below. 2A Prof Mar Ratio 2A Tot Asset Turn 2A Ret on Tot Assets 2A Ret On Equity 2A Price Earn Ratio 2A Div Yield Req 2B For both companies compute the profit margin ratio. (a) Company Profit Margin Ratio Denominator: Numerator: Current assets XI Current liabilities = Profit margin ratio Profit margin ratio 0 % o % Barco / = Kyan 1 = 2A Prof Mar Ratio 2A Tot Asset Turn > Return to question Required information Answer is not complete. Complete this question by entering your answers in the tabs below. 2A Prof Mar Ratio 2A Tot Asset Turn 2A Ret on Tot Assets 2A Ret On Equity 2A Price Earn Ratio 2A Div Yield Req 2B For both companies compute the total asset turnover (b) Total Asset Turnover Company Numerator: 7 Denominator: P Total Asset Turnover Current assets x / Current liabilities = Total asset turnover Barco 1 = 0 times Kyan / = 0 times Return to question ! Required information X Answer is not complete. Complete this question by entering your answers in the tabs below. 2A Prof Mar Ratio 2A Tot Asset Turn 2A Ret on Tot Assets 2A Ret On Equity 2A Price Earn Ratio 2A Div Yield Req 2B For both companies compute the return on total assets. Return on Total Assets (c) Company Numerator: 1 Denominator: = Return on Total Assets / = Return on total assets Barco 1 = 0 % Kyan 1 = 0 % Return to question ! Required information Answer is not complete. Complete this question by entering your answers in the tabs below. 2A Prof Mar Ratio 2A Tot Asset Turn 2A Ret on Tot Assets 2A Ret On Equity 2A Price Earn Ratio 2A Div Yield Req 2B For both companies compute the return on equity. Return On Equity (d) Company Numerator: / Denominator Return On Equity / Return on equity Barco 1 II 0 % Kyan 0 %
