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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 $ $810,000$ $ $919,200$

Cash $ $18,500$ $ $36,000$ Cost of goods sold $595,100632,500$

Accounts receivable, net $38,40054,400$ Interest expense $9,20019,000$

Merchandise inventory $84,540132,500$ Income tax expense $15,56925,376$

Prepaid expenses $5,3007,450$ Net income $190,131242,324$

Plant assets, net $370,000308,400$ Basic earnings per share $5\mathrm{.}005\mathrm{.}13$

Total assets $ $516,740$ $ $538,750$ Cash dividends per share $3\mathrm{.}763\mathrm{.}93$

Liabilities and Equity Beginning$-$of$-$year balance sheet data

Current liabilities $ $62,340$ $ $103,300$ Accounts receivable, net $ $28,800$ $ $50,200$

Long$-$term notes payable $86,800113,000$ Merchandise inventory $57,600113,400$

Common stock, $$5$ par value $190,000236,000$ Total assets $408,000372,500$

Retained earnings $177,60086,450$ Common stock, $$5$ par value $190,000236,000$

Total liabilities and equity $ $516,740$ $ $538,750$ Retained earnings $130,34929,622$

Required:

$1$a$.$ 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.

Note: Do not round intermediate calculations.

$1$b$.$ Identify the company you consider to be the better short$-$term credit risk.

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