Exercise 13-10 Efficiency and profitability analysis LO P3 [The following information applies to the questions displayed below.] Simon Company's year-end balance sheets follow. At December 31 2017 2016 2015 Assets Cash $31,800 36,250 38,000 62,000 80,600 9,350 257,000 Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net 87,600 111,000 10,950 279,000 49,500 53,000 4,900 232,000 $520,350 $445,200 $377,400 Total assets Liabilities and Equity Accounts payable Long-term notes payable secured by mortgages on plant assets Common stock, $10 par value Retained earnings $128,400 $ 74,250 $ 50,800 80,600 163,000 83,000 97,500 163,000 131,450 101,250 163,000 106,700 $520,350 $445,200 $377,400 Total liabilities and equity The company's income statements for the years ended December 31, 2017 and 2016, follow For Year Ended December 31 2017 2016 Sales $685,000 $530,000 Cost of goods sold Other operating expenses $397,300 198,650 12,300 9,500 $333,900 132,500 12,700 8,800 Interest expense Income taxes Total costs and expenses 617,750 487,900 $ 42,100 $67,250 Net income 4.13 $ 2.58 Earnings per share Evaluate the company's efficiency and profitability by computing the following for 2017 and 2016 Exercise 13-1O Part 1 (1) Profit margin ratio Profit Margin Ratio IChoose Denominator: Profit Margin Ratio Choose Numerator: Profit margin ratio 2017 / 2016 (2) Total asset turnover. Total Asset Turnover Choose Denominator: = Total Asset Turnover Choose Numerator: / Total asset turnover times / 2017 / times 2016 I II (3) Return on total assets. Return On Total Assets Choose Denominator: Return On Total Assets Choose Numerator: Return on total assets / 2017 % 2016