Summary information from the financial statements of two companies competing in the same industry follows. Barco Kyan Barco Kyan Company Company Company Company Data from the current year-end balance sheets Data from the current year's income statement Assets Sales $760,000 5915,200 Cash 5 20,500 $ 31,000 Coat of goods sold 584,100 630,500 Accounts receivable, net 37,400 52,400 Interest expense 8,300 17.000 Current notes receivable (trade) 9,200 8,200 Income tax expense 14,608 25,1266 Merchandise inventory 84,840 138.500 Net Income 152,992 242, 434 Prepaid expenses 5,800 7,250 Basic earnings per share 3.82 5.88 Plant assets, net 340,000 306.400 Cash dividends per share 3.77 3.97 Total assets $497,740 $543,750 Liabilities and Equity Beginning-of-year balance sheet data Accounts receivable, net $ 30,800 $ 57,200 Current liabilities $ 71,340 $ 99,300 Current notes receivable (trade) 0 0 Long-term notes payable 79,800 115,000 Merchandise inventory 59,600 115.400 Common stock, 55 par value 200,000 206,000 Total assets 458.000 372,500 Retained earnings 146,600 123,450 Connon stock, $5 par value 200,000 206,000 Total liabilities and equity $497,740 $543,750 Retained earnings 144,400 44,580 2a. For both companies compute the (a) profit margin ratio. (b) total asset turnover, (return on total assets, and (d) return on common stockholders' equity. Assuming that share and each company's stock can be purchased at $90 per share, compute their (e) price-earnings ratios and ( dividend yields. (Do not round Intermediate calculations. Round your answers to 2 decimal places.) 25. Identify which company's stock you would recommend as the better investment. Complete this question by entering your answers in the tabs below. Reg 28 2A Pro Marg 2A Tot Asset 2A Ret on Tot 2A Ret On Com 2A Price Earn Ratio Turn Assets Stock Equity Ratio 2A Div Yield For both companies compute the profit margin ratio. Profit Margin Ratio Company Choose Numerator: 1 Choose Denominator: = Profit margin ratio - Profit margin ratio Barco 1 % Kyan AF Mar Ralla 2A Tot Asset Turn > Complete this question by entering your answers in the tabs below. 2A Pro Marg Ratio 2A Tot Asset Turn 2A Ret on Tot 2A Ret On Com 2A Price Eam Assets Stock Equity Ratio 2A Div Yield Reg 28 For both companies compute the total asset turnover (b) Company Choose Numerator: Total Asset Turnover 1 Choose Denominator: = Total Asset Turnover = Total asset turnover times Barco Kyan times (2A Pro Marg Ratio 2A Ret on Tot Assets Complete this question by entering your answers in the tabs below. 2A Pro Marg 2A Tot Asset 2A Ret on Tot 2A Ret On Com 2A Price Earn Ratio Turn Assets Stock Equity Ratio 2A Div Yield Reg 28 For both companies compute the return on total assets. (C) Return on Total Assets Company Choose Numerator: Choose Denominator: - Return on Total Assets Return on total assets Barco % Kyan 7 % Complete this question by entering your answers in the tabs below. Reg 2B ZA Pro Marg 2A Tot Asset 2A Ret on Tot 2A Ret On Com 2A Price Earn Ratio Turn 2A Div Yield Assets Stock Equity Ratio For both companies compute the return on common stockholders' equity. Company Choose Numerator: Return On Common Stockholders' Equity Choose Denominator - Return On Common Stockholders' Equity = Return On common stockholders' equity Barco Kyan % % Complete this question by entering your answers in the tabs below. Reg 2B 2A Pro Marg 2A Tot Asset 2A Ret on Tot 2A Ret On Com 2A Price Earn 2A Div Yield Ratio Turn Assets Stock Equity Ratio Assuming that share and each company's stock can be purchased at $90 per share, compute their dividend yields. Dividend Yield Company Choose Numerator: Choose Denominator: Dividend Yield = Dividend yield Barco % Kyan % Complete this question by entering your answers in the tabs below. Turn Reg 2B 2A Pro Marg 2A Tot Asset 2A Ret on Tot 2A Ret On Com 2A Price Earn Ratio Assets Stock Equity 2A Div Yield Ratio Identify which company's stock you would recommend as the better investment The better investment
