Exercise 13-7 Analyzing liquidity LO P3 Simon Company's year-end balance sheets follow. At December 31 Current Yr 1 Yr Ago 2 Yrs Ago Assets $ 27,230 76,623 96,338 8,514 239,380 $ 448,085 $ 30,284 $ 31,549 55,161 42,491 70,033 46,624 8,031 3,470 222,771 197,766 $ 386,280 $ 321,900 Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Long-term notes payable secured by mortgages on plant assets Common stock, $10 par value Retained earnings Total liabilities and equity $ 112,689 $ 64,629 $ 42,916 85, 925 162,500 86,971 $ 448,085 87,956 162,500 71,195 $ 386, 280 70, 429 162,500 46,055 $ 321,900 (1-a) Compute the current ratio for each of the three years. (1-b) Did the current ratio improve or worsen over the three year period? (2-a) Compute the acid-test ratio for each of the three years. (2-b) Did the acid-test ratio improve or worsen over the three year period? Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 2A Required 2B Compute the current ratio for each of the three years. Current Ratio 1 Choose Denominator: Choose Numerator: Current Ratio Current ratio to 1 Current Yr: 1 Yr Ago: 2 Yrs Ago: to 1 I 1 to 1 Required 1A Required 1B Required 2A Required 2B Did the current ratio improve or worsen over the three year period? Current ratio Required 1A Required 1B Required 2A Required 2B Compute the acid-test ratio for each of the three years. Acid-test ratio Choose Numerator: 1 Choose Denominator: Acid-Test Ratio + + / Acid-test ratio Current Yr: + + / to 1 + / to 1 1 Yr Ago: 2 Yrs Ago: + + + / = to 1 Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 2A Required 2B Did the acid-test ratio improve or worsen over the three year period? Acid-test ratio Dorm