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 $ 25,560 72,614 92,221 7,987 230,551 $428,933 $ 29,582 $ 30,207 50,732 39,478 69,776 42,469 7,843 3,323 211,837 186,623 $ 369,770 $ 302,100 $107,872 $ 62,491 $ 38,681 82,252 162,500 76,309 $428,933 85,898 65,429 162,500 162,500 58,881 35,490 $ 369,770 $ 302,100 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 $557,613 $340, 144 172,860 9,479 7,249 529, 732 $ 27,881 $ 1.72 1 Yr Ago $440,026 $286,017 111,327 10,121 6,600 414,065 $ 25,961 1.60 For both the Current Year and 1 Year Ago, compute the following ratios: Debt Ratio Choose Numerator: Choose Denominator: Debt Ratio II Debt ratio Current Year: % = = 1 Year Ago: % Equity Ratio Choose Denominator: Choose Numerator: = Equity Ratio Equity ratio 11 % Current Year: 1 Year Ago: = Debt-To-Equity Ratio Choose Numerator: 1 Choose Denominator: 1 11 Debt-To-Equity Ratio Debt-to-equity ratio 0 to 1 0 to 1 / Current Year: Il 11 1 Year Ago: / Times interest earned. Times Interest Earned 1 Choose Denominator: = Choose Numerator: E Times Interest Earned Times Interest earned times Current Year: times 1 Year Ago