• The following summaries from the income statements and balance sheets of Neeko, Inc. and Saxony, Inc. are presented below. (1) For both companies for 2014, compute the: (a) Current ratio (b) Acid-test ratio (c) Accounts receivable turnover (d) Inventory turnover (e) Days' sales in inventory (f) Days' sales uncollected
• Which company do you consider to be the better short-term credit risk? Explain. (2) For both companies for 2014, compute the: (a) Profit margin ratio (b) Return on total assets (c) Return on common stockholders' equity
• Which company do you consider to have better profitability ratios?

Neeko, Inc. Consolidated Balance Sheets (in millions)
	May 31
	2014	2013
Assets
Current assets:
Cash and cash equivalents............................................................................................	$ 634.0	$575.5
Accounts receivable, net of allowance............................................................................................	2,101.1	1,804.1
Inventories............................................................................................	1,514.9	1,373.8
Other current assets............................................................................................	429.9	401.3
Total current assets............................................................................................	4,679.9	4,154.7
Property, plant, and equipment, net............................................................................................	1,620.8	1,614.5
Other long term assets............................................................................................	413.2	670.8
Total assets............................................................................................	$6,713.9	$6,440.0
Liabilities and Stockholders Equity
Current liabilities:
Current portion of long-term debt............................................................................................	$ 205.7	$ 55.3
Notes payable............................................................................................	75.4	425.2
Accounts payable............................................................................................	572.7	504.4
Accrued liabilities............................................................................................	1,054.2	765.3
Income taxes payable............................................................................................	107.2	83.0
Total current liabilities............................................................................................	2,015.2	1,833.2
Long term liabilities............................................................................................	708.0	767.8
Total liabilities............................................................................................	2,723.2	2,601.0
Stockholders equity:
Common stock............................................................................................	2.8	2.8
Contributed capital in excess of par value............................................................................................	589.0	538.7
Unearned stock compensation............................................................................................	(0.6)	(5.1)
Accumulated other comprehensive loss............................................................................................	(239.7)	(192.4)
Retained earnings............................................................................................	3,639.2	3,495.0
Total stockholders equity............................................................................................	3,990.7	3,839.0
Total liabilities and stockholders equity............................................................................................	$6,713.9	$6,440.0