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 1A Acid Test 1A Acct RecRatioRatioTurnFor both companies compute the current ratio.(a)CompanyBarcoKyanNumerator:11A InventTurnoverCurrent Ratio1A Days Sal in 1A Days Sal 1B short termInvUncolDenominator:===Current RatioCurrent ratiodalato 1to 1 Summary information from the financial statements of two companies competing in the same industry follows.KyanCompanyBarcoCompanyData from the current year-endbalance sheetsAssetsCashAccounts receivable, netMerchandise inventoryPrepaid expensesPlant assets, netTotal assetsLiabilities and EquityCurrent liabilitiesLong-term notes payableCommon stock, $5 par valueRetained earningsTotal liabilities and equityBarcoCompany$ 19,00036,40084,6405,700360,000$ 505,740$ 33,00057,400130,5007,450307,400$ 535,750$ 61,34081,800220,000142,600$ 505,740 $ 535,750$ 100,300101,000206,000128,450Data from the current year's incomestatementSalesCost of goods soldInterest expenseIncome tax expenseNet incomeBasic earnings per shareCash dividends per shareBeginning-of-year balance sheet datalAccounts receivable, netMerchandise inventoryTotal assetsCommon stock, $5 par valueRetained earnings$ 760,000586,1007,70014,608151,5923.453.79$ 25,80055,600448,000220,000157,768Kyan Company$ 909, 200648,50019,00025,100216,6005.263.95$ 58,200113,400412,500206,00074,590Required: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.

Particulars Barco Kyan 1 Current Ratio a Current Assets - Numerator Cash 19000 33000…

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 ( days' sales uncollected. (Do not round intermediate calculations.) 1b. Identify the company you consider to be the better short-term credit risk.

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 ( days' sales uncollected. (Do not round intermediate calculations.) 1b. Identify the company you consider to be the better short-term credit risk.

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter9: Metric-analysis Of Financial Statements

Section: Chapter Questions

Problem 9.1E

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