Required information Exercise 13-10 Efficiency and profitability analysis LO P3 [The following information applies to the questions displayed below.] Simon Companys year-end balance sheets follow. At December 31 2017 2016 2015 Assets Cash $ 31,800 $ 35,500 $ 37,200 Accounts receivable, net 88,300 62,500 51,000 Merchandise inventory 112,000 83,200 54,000 Prepaid expenses 10,350 9,500 5,300 Plant assets, net 279,000 254,500 227,000 Total assets $ 521,450 $ 445,200 $ 374,500 Liabilities and Equity Accounts payable $ 129,200 $ 74,250 $ 50,800 Long-term notes payable secured by mortgages on plant assets 95,500 98,750 83,800 Common stock, $10 par value 163,500 163,500 163,500 Retained earnings 133,250 108,700 76,400 Total liabilities and equity $ 521,450 $ 445,200 $ 374,500 The companys income statements for the years ended December 31, 2017 and 2016, follow. For Year Ended December 31 2017 2016 Sales $ 785,000 $ 540,000 Cost of goods sold $ 463,150 $ 345,600 Other operating expenses 219,800 129,600 Interest expense 11,100 12,900 Income taxes 9,450 8,675 Total costs and expenses 703,500 496,775 Net income $ 81,500 $ 43,225 Earnings per share $ 4.98 $ 2.64 Evaluate the company's efficiency and profitability by computing the following for 2017 and 2016. Exercise 13-10 Part 1 (1) Profit margin ratio.