information nformation applies to the questions displayed below competing in the

Question

information nformation applies to the questions displayed below competing in the same industry follows Kyan Barco Kyan Company Company $790,000 $895,20e 589,100 6461589 7,900 10,000 s 21,000 s 32,0 Cost of goods sold ,400 8,80 Incone tax expense ,6 7,50 Basic earnings per share 84,540 138,500 Net income 177,815 213,986 Prepaid expenses Plant assets, ne Total assets 309,400 Cash dividends per share 3,74 3.93 $495,940 $550,15 Liabilities and Equity s 26,800 $ 56J200 s 61,340 80,300 Current notes receivable (trade) 79,800 9,000 erchandise inventory 1644800 154mo comon stock, $5 par value 3403,840 359,159 Retined earning 61,600 109 1400 428,000 412,500 190,000 1961000 129,105 94,920 Required:

Explanation / Answer

a) Current Ratio Company Choose Numerator Choose Denominator Current Ratio Current Asset / Current Liabilities Barco $                     155,940.00 / $                   61,340.00 =           2.54 Kyan $                     240,750.00 / $                 100,300.00 =           2.40 b) Acid Test Ratio Company Choose Numerator Choose Denominator Acid Test Ratio Current Asset except inventory & prepaid Exp + Current Liabilities   Acid Test Ratio Barco $                       65,800.00 / $                   61,340.00 =           1.07 Kyan $                       95,200.00 / $                 100,300.00           0.95 c) Accounts Receivable Turnover Company Choose Numerator Choose Denominator Accounts Receivable Turnover Net Credit Sales Average Accounts Receivable, Net Barco $                     790,000.00 / $                   35,800.00 =         22.07 Kyan $                     895,200.00 / $                   59,700.00 =         14.99 d) Inventory Turnover Company Choose Numerator Choose Denominator Inventory Turnover COGS / Average Inventory Barco $                     589,100.00 / $                   73,070.00 =           8.06 Kyan $                     646,500.00 / $                 123,950.00 =           5.22 e) Days' Sales in inventory Company Choose Numerator Choose Denominator * Days Days' Sales in inventory Merchandise Inventory / COGS      365.00 Barco $                       73,070.00 / $                 589,100.00      365.00 =         45.27 Kyan $                     123,950.00 / $                 646,500.00      365.00 =         69.98 f) Days' Sales Uncollected Company Choose Numerator Choose Denominator * Days Days' Sales Uncollected Current Receivables, net / Net Sales      365.00 Barco $                       35,800.00 / $                 790,000.00      365.00 =         16.54 Kyan $                       59,700.00 / $                 895,200.00      365.00 =         24.34

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