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[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
[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 $ 19,000 $ 38,000 Accounts receivable, net 37,400 52,400 Current notes receivable 9,900 8.000 (trade) Merchandise inventory 84.940 132,500 Prepaid expenses 5,600 7750 330,000 Plant assets, net 311,400 Barco Kyan Company Company Data from the current year's income statement Sales $ 800,000 $897,200 Cost of goods sold 592,100 638,500 Interest expense 8,100 15,000 Income tax expense 15,377 24,769 Net income 184,423 218,931 Basic earnings per share 4.39 4.64 Cash dividends per share 3.77 4.00 Total assets $ 486,840 os 550,050 Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings $69,340 $100,300 80,800 101.000 210,000 236,000 Beginning-of-year balance sheet data Accounts receivable, net $ 27,800 $ 52,200 Current notes receivable 0 0 (trade) Merchandise Inventory 63,600 105,400 388,000 Total assets Common stock, $5 par value 412.500 236,000 126,700 112,750 210,000 486,840 $ 550,050 Total liabilities and equity $ Retained earnings 100.617 82,619 2.1 For both companies compute the (a) profit margin ratio, (b) total asset turnover, ( return on total assets, and (c) return on common stockholders' equity. Assuming that share and each company's stock can be purchased at $95 per share, compute their (e) price-earnings ratios and dividend yields. (Do not round intermediate calculations. Round your answers to 2 decimal places.) (a) Company Choose Numerator: Profit Margin Ratio Choose Denominator: 1 = 1 Profit margin ratio Profit margin ratio 0 % Barco 1 Kyan = 0 % (6) Company Choose Numerator: Total Asset Turnover Choose Denominator: 1 Total Asset Turnover Total asset turnover 1 1 Barco O times Kyan / O times Required information (c) Company Choose Numerator: Return on Total Assets Choose Denominator: 1 Return on Total Assets 1 Return on total assets 1 Barco Kyan 0 % 0 % (d) Company Choose Numerator: Return On Common Stockholders' Equity Choose Denominator Return On Common Stockholders' Equity = Return On common stockholders' equity Barco Kyan 0 % 0% Required information Company Choose Numerator: Prico-Earnings Ratio Choose Denominator: 1 1 = Price-Earnings Ratio Price-earnings ratio 0 times / Barco Kyan 1 = 0 times Company Choose Numerator: Dividend Yield 1 Choose Denominator: / Barco Kyan Dividend Yield Dividend yield 0 % 0 % 7 Required information ( Company Choose Numerator: Dividend Yield 4 Choose Denominator: 1 Barco Kyan Dividend Yield Dividend yield 0 % 0 % 2.2Identify which company's stock you would recommend as the better investment Kyan company O Barco company
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