At December 31 Assets Current Year 1 Year Ago 2 Years Ago Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable $ 31,800 89,500 112,500 10,700 278,500 $ 523,000 98,500 $ 129,900 Long-term notes payable Common stock, $10 par value Retained earnings Total liabilities and equity $ 35,625 62,500 82,500 9,375 255,000 $ 445,000 $ 75,250 101,500 163,500 104,750 163,500 131,100 $ 523,000 $ 445,000 $ 37,800 50,200 54,000 5,000 230,500 $ 377,500 $ 51,250 83,500 163,500 79,250 $ 377,500 For both the current year and one year ago, compute the following ratios: The company's income statements for the current year and one year ago, follow. For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense Income tax expense Total costs and expenses Net income Earnings per share (1) Debt and equity ratios. Current Year 1 Year Ago $ 673,500 $ 532,000 $ 411,225 209,550 12,100 9,525 $ 345,500 134,980 13,300 8,845 642,400 $ 31,100 $ 1.90 (2-0) Compute debt-to-equity ratio for the current year and one year ago. 502,625 $ 29,375 $ 1.80 (2-b) Based on debt-to-equity ratio, does the company have more or less debt in the current year versus one year ago? (3-0) Times interest earned. (3-b) Based on times interest earned, is the company more or less risky for creditors in the Current Year versus 1 Year Ago? Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 2B Required 3A Required 38 Compute debt and equity ratio for the current year and one year ago. Current Year: 1 Year Ago: Current Year: Debt Ratio Numerator: 1 Denominator: = Debt Ratio 1 = Debt ratio 1 = 0% 1 0% Equity Ratio Numerator: 1 Denominator: = Equity Ratio 1 = Equity ratio 0 96