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
Company |
Kyan
Company |
|
|
Barco
Company |
Kyan
Company |
Data from the current year-end balance sheets
|
|
Data from the current year’s income statement
|
Assets
|
|
|
|
|
|
|
|
Sales |
$ |
770,000 |
|
$ |
914,200 |
|
Cash |
$ |
21,000 |
|
$ |
34,000 |
|
|
Cost of goods sold |
|
587,100 |
|
|
642,500 |
|
Accounts receivable, net |
|
34,400 |
|
|
59,400 |
|
|
Interest expense |
|
9,100 |
|
|
17,000 |
|
Merchandise inventory |
|
84,940 |
|
|
132,500 |
|
|
Income tax expense |
|
14,800 |
|
|
25,238 |
|
Prepaid expenses |
|
5,400 |
|
|
7,350 |
|
|
Net income |
|
159,000 |
|
|
229,462 |
|
Plant assets, net |
|
310,000 |
|
|
307,400 |
|
|
Basic earnings per share |
|
3.79 |
|
|
5.08 |
|
Total assets |
$ |
455,740 |
|
$ |
540,650 |
|
|
Cash dividends per share |
|
3.82 |
|
|
4.01 |
|
|
|
|
|
|
|
|
|
|
Liabilities and Equity
|
|
|
|
|
|
|
|
Beginning-of-year balance sheet data
|
|
Current liabilities |
$ |
70,340 |
|
$ |
102,300 |
|
|
Accounts receivable, net |
$ |
28,800 |
|
$ |
56,200 |
|
Long-term notes payable |
|
82,800 |
|
|
107,000 |
|
|
Merchandise inventory |
|
63,600 |
|
|
115,400 |
|
Common stock, $5 par value |
|
210,000 |
|
|
226,000 |
|
|
Total assets |
|
388,000 |
|
|
382,500 |
|
Retained earnings |
|
92,600 |
|
|
105,350 |
|
|
Common stock, $5 par value |
|
210,000 |
|
|
226,000 |
|
Total liabilities and equity |
$ |
455,740 |
|
$ |
540,650 |
|
|
Retained earnings |
|
94,040 |
|
|
57,140 |
|
|
rev: 11_27_2019_QC_CS-192168
Required:
1a. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts receivable turnover, (d) inventory turnover, (e) days’ sales in inventory, and (f) days’ sales uncollected.(Do not round intermediate calculations.)
1b. Identify the company you consider to be the better short-term credit risk.
![Required information<br>[The following information applies to the questions displayed below.]<br>Summary information from the financial statements of two companies competing in the same industry follows.<br>Кyan<br>Company Company<br>Barco<br>Barco<br>Кyan<br>Company Company<br>Data from the current year-end balance sheets<br>Data from the current year's income statement<br>Assets<br>Sales<br>$770,000 $914, 200<br>587,100<br>$ 21,000 $ 34,000<br>34,400<br>84,940<br>5,400<br>Cash<br>642,500<br>Accounts receivable, net<br>Merchandise inventory<br>Prepaid expenses<br>Plant assets, net<br>59,400<br>132,500<br>7,350<br>307,400<br>Cost of goods sold<br>Interest expense<br>Income tax expense<br>Net income<br>9,100<br>14,800<br>159,000<br>17,000<br>25 238<br>229,462<br>310,000<br>Basic earnings per share<br>3.79<br>5.08<br>Total assets<br>$455,740 $540,650<br>Cash dividends per share<br>3.82<br>4.01<br>|<br>Liabilities and Equity<br>Current liabilities<br>Beginning-of-year balance sheet data<br>Accounts receivable, net<br>Merchandise inventory<br>Total assets<br>$ 70,340 $102,300<br>$ 28,800 $ 56/200<br>Long-term notes payable<br>Common stock, $5 par value<br>Retained earnings<br>82,800<br>210,000<br>92,600<br>107,000<br>226,000<br>105, 350<br>63,600<br>388,000<br>115,400<br>382 500<br>Common stock, $5 par value<br>210,000<br>226,000<br>Total liabilities and equity<br>$455,740 $540,650<br>Retained earnings<br>94,040<br>57,140<br>Required:<br>1a. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts receivable turnover, (d) inventory turnover, (e) days'<br>sales in inventory, and (f days' sales uncollected. (Do not round intermediate calculations.)<br>1b. Identify the company you consider to be the better short-term credit risk.<br>Complete this question by entering your answers in the tabs below.<br>1A Current<br>Ratio<br>1A Acct Rec<br>1A Acid Test<br>Ratio<br>1A Invent<br>1A Days Sal in 1A Days Sal<br>Uncol<br>1B short term<br>Turn<br>Turnover<br>Inv<br>For both companies compute the current ratio.<br>(a)<br>Current Ratio<br>Company Choose Numerator:<br>I Choose Denominator:<br>Current Ratio<br>= Current ratio<br>Barco<br>to 1<br>|Кyan<br>to 1<br>< 1A Current Ratio<br>1A Acid Test Ratio ><br>](https://s3.us-east-1.amazonaws.com/storage.unifolks.com/qimg-008/008_uqqvzj0-nvgyrlfw.jpeg)
Extracted text: Required information [The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows. Кyan Company Company Barco Barco Кyan Company Company Data from the current year-end balance sheets Data from the current year's income statement Assets Sales $770,000 $914, 200 587,100 $ 21,000 $ 34,000 34,400 84,940 5,400 Cash 642,500 Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net 59,400 132,500 7,350 307,400 Cost of goods sold Interest expense Income tax expense Net income 9,100 14,800 159,000 17,000 25 238 229,462 310,000 Basic earnings per share 3.79 5.08 Total assets $455,740 $540,650 Cash dividends per share 3.82 4.01 | Liabilities and Equity Current liabilities Beginning-of-year balance sheet data Accounts receivable, net Merchandise inventory Total assets $ 70,340 $102,300 $ 28,800 $ 56/200 Long-term notes payable Common stock, $5 par value Retained earnings 82,800 210,000 92,600 107,000 226,000 105, 350 63,600 388,000 115,400 382 500 Common stock, $5 par value 210,000 226,000 Total liabilities and equity $455,740 $540,650 Retained earnings 94,040 57,140 Required: 1a. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts receivable turnover, (d) inventory turnover, (e) days' sales in inventory, and (f days' sales uncollected. (Do not round intermediate calculations.) 1b. Identify the company you consider to be the better short-term credit risk. Complete this question by entering your answers in the tabs below. 1A Current Ratio 1A Acct Rec 1A Acid Test Ratio 1A Invent 1A Days Sal in 1A Days Sal Uncol 1B short term Turn Turnover Inv For both companies compute the current ratio. (a) Current Ratio Company Choose Numerator: I Choose Denominator: Current Ratio = Current ratio Barco to 1 |Кyan to 1 < 1a="" current="" ratio="" 1a="" acid="" test="" ratio="">