7.

Required information [The following information applies to the questions displayed below.] Simon Company's year-end balance sheets follow. For both the current year and one year ago, compute the following ratios: 1. Express the balance sheets in common-size percents, 2. Assuming annual sales have not changed in the last three years, is the change in accounts receivable as a percentage of total assets favorable or unfavorable? 3. Assuming annual sales have not changed in the last three years, is the change in merchandise inventory as a percentage of total assets favorable or unfavorable? SIMON COMPANY Common-Size Comparative Balance Sheets December 31