Exercise 13-8 Analyzing and interpreting liquidity LO P3 [The following information applies to the questions displayed below.) Simon Company's year-end balance sheets follow. Current Yr 1 Yr Ago 2 Yrs Ago At December 31 Assets 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 $ 24,905 89,300 110,000 8,020 194,153 $426,378 $ 29,111 $ 30, 324 62,700 50,500 84,000 55,000 7,642 3,369 184, 114 170, 207 $ 367,567 $ 309,400 $105, 106 $ 61,498 $ 40,432 79,357 162,500 79,415 $426,378 83,695 67, 694 162,500 162,500 59,874 38,774 $ 367,567 $ 309, 400 The company's income statements for the Current Year and 1 Year Ago, follow. Assume that all sales are on credit: For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense Income tax expense Total costs and expenses Net income Current Yr $ 554,291 $ 338, 118 171,830 9,423 7,206 526,577 $ 27,714 1 Yr Ago $ 437, 405 $ 284,313 110,663 10,060 6,561 411,597 $ 25,808 Earnings per share $ 1.71 $ 1.59 Exercise 13-8 Part 2 (2-a) Compute accounts receivable turnover. (2-b) For each ratio, determine if it improved or worsened in the current year. Complete this question by entering your answers in the tabs below. Required 2A Required 2B Compute accounts receivable turnover. Accounts Receivable Turnover Choose Numerator: 1 Choose Denominator: Accounts Receivable Turnover Accounts receivable turnover = Current Yr: 1 times 1 Yr Ago: 1 times (3-a) Compute inventory turnover. (3-b) For each ratio, determine if it improved or worsened in the current year. Complete this question by entering your answers in the tabs below. Required 3A Required 3B Compute inventory turnover. Inventory Turnover / Choose Denominator: Choose Numerator: = Inventory Turnover 1 II Inventory turnover Current Yr: / times 1 Yr Ago: 1 II times