The current year financial statements for Blue Water Company and Prime Fish Company are presented below. Blue Water Prime Fish Balance sheet Cash Accounts receivable (net) Inventory Property &equipment (net) Other assets Total assets Current liabilities Long-term debt (interest rate: 10%) Capital stock ($10 par value) Additional paid-in capital Retained earnings Total liabilities and stockholders' equity Income statement: Sales revenue (1/3 on credit) Cost of goods sold Operating expenses Net income Other data Per share stock price at end of current year Average income tax rate Dividends declared and paid in current year $ 41,400 40,000 97,000 146,000 84,400 S 408,800 $ 97,000 67,800 150,800 29,400 63,800 S 408,800 $ 20,600 32,200 42,400 405,800 309,000 $ 810,000 S 55,000 60,800 516,000 106,400 71,800 $ 810,000 $ 441,000 (239,000) (161,800) $ 40,200 S 798,000 (400,400) (311.400) $ 86,200 S 22.4 19 30% 30% $ 33,400 $ 150,000 Both companies are in the fish catching and manufacturing business. Both have been in business approximately 10 years, and each has had steady growth. The management of each has a different viewpoint in many respects. Blue Water is more conservative, and as its president has said, "We avoid what we consider to be undue risk." Neither company is publicly held