Exercise 13-9 Analyzing risk and capital structure 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 $ 34,423 101,743 122,955 11,195 307,345 $577,661 $ 39,042 $ 39,887 69,021 53,183 90, 284 58,356 10,562 4,432 289, 075 247, 042 $ 497,984 $ 402,900 $145,276 $ 84,159 $ 51,587 107,514 162,500 162,371 $577,661 116,827 89,931 162,500 162,500 134,498 98,882 $ 497,984 $ 402,900 The company's income statements for the Current Year and 1 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 Current Yr $750,959 $458,085 232,797 12,766 9,762 713,410 $ 37,549 1 Yr Ago $ 592,601 $385,191 149,928 13,630 8,889 557,638 $ 34,963 $ 2.31 $ 2.15 For both the Current Year and 1 Year Ago, compute the following ratios: Exercise 13-9 Part 1 (1) Debt and equity ratios. Choose Numerator: Accounts receivable Answer is not complete. Debt Ratio Choose Denominator: Cost of goods sold 1 Debt Ratio Debt ratio % Current Year: 1 Year Ago: 0 0 II = % Equity Ratio Choose Denominator: Choose Numerator: = Equity Ratio Equity ratio II / = = = II Current Year: 1 Year Ago: % 0 0 = 11 %