Question

what is the average common stock holders equity?

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. Barco Company Data from the current year-end balance sheets Kyan Coпpany Barco Company Data from the current year's income statement $780,000 588,100 8,400 14,99: 168,501 Assets Sales Cash $ 21,000 $ 33,000 37,400 84,640 5,200 Cost of goods sold Interest gxpense Income tat expense Net income Basic earnings per share Cash dividends per share Accounts receivable, net. Merchandise inventory Prepaid expenses Plant assets, net 54, 400 134,500 7,200 370,000 309,400 4.9 Total assets $518,240 $538,500 3.75 Liabilities and Equity Current liabilities Long-term notes payable Common stock, $5 par value Retained earnings Beginning-of-year balance sheet data Accounts receivable, net Merchandise inventory Total assets Common stock, $5 par value $ 64,340 $100,300 101,000 216,000 121,200 $ 28,800 53,600 408,001 170,000 80,800 170,000 203,100 Total liabilities and equity $518,240 $538,500 Retained earnings 163,45:

Answer 1

2a) la) Company Choose Numerator Profit margin Ratio / Choose Denominador = on Profit - Profit Net Sales Margin. Ratio margin. Net Income Ratio 21.60 Barco $ 168,508 $ 780,000 24.25 Куап $ 891,200 $216,097 b) Total Asset Turnover Turnover Turnover Company Choose Numerator / Choose Denominator = Total Asset Net sales / Average Total Assets - Total Asset Barco $ 780,000 $463,120 1.68 kyan | $891,200 IL $475,500 = 1.87 times times. Calculation: Average Total Assets = {(Beginning Total Assets & Ending Total Assets) = 2] Barcos Average Total Assets = [($ 400,000 + $518,240)=2) = $926,240 = 2 - $463, 120 kyan: Average Total Assets & [L$ 412,500 + $538,500)=2] - $ 951,000 2 = $475,500

(C) Company Return on Total Assets Return on Choose Numerator / Choose Demoninator = Total Assets Average Total Return on Net Income Assets Total Assets 1 $160,500 $463, 120 36.39 $216,097 / $475,500 = 45.45 Barco Kyan %) Note: Total Assets are calculated above in Average part (b). (d, Return on Common Stockholders' Equity Choose Return on a Choose Numerator = common stockhol- Denominator = ders Equity Net Preferred Average Common Return on Common Income Dividends dtock holders' Equity - Stockholders' Equity Barco $ 168,508 - $0 1 $353,276 = 47.70 of Kyan. $216,097 - $0 1 $ 314,040 = 60.81 og Calculation? Average common Stockholders' Equity = {(Beginning common Stock & Beginning Retained Earnings + Ending common stock & Ending Retained Earnings) + 2] Barco Average common Stock holders & = stock holders' Equity [($ 170,000 & $ 163,452 + $170,000 + $ 203,100) : 2) z $ 706,552 + 2 e $353,276

Ryan: Average commion Atock holders' Equity = ($216,000 + $74,879 + $ 216,000 + $121,200) : 2) = $628,079 +2 = $314,039.5 or $314,040 (e) Price - Earnings Ratio T Price - Earnings Company Choose Numerator / Choose Denominator = Ratio Market Price per il Earnings Price - Earnings Common share per share Ratio $ loo $ 4.96 = 20.16 times кчам 5.oo 20.00 times Barco $loo Dividendo Yields Choose Company Choose Wumerator / Denominator Annual cash dividend Market Price Per share per share Barco $ 3.79 $ 10o $3.93 & loo Dividend Yields Dividend Yields 3. 79 17 3.93 kyan lab, kyan company will be recommended better investment. as the