Required information Exercise 13-9 Risk and capital structure analysis LO P3 (The following information applies to the questions displayed below. Simon Company's year-end balance sheets follow. At December 31 2017 2016 2015 $ 37,550 $ 43,892 $ 44,381 110,986 76,812 57,434 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net 135,480 100,496 62,409 12,212 11,294 4,738 333,910 310,728 270,538 Total assets $630,138 $543,222 $439,500 $156,904 $ 90,886 $ 56,274 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 114,912 128,689 96,158 162,500 162,500 162,500 195,822 161,147 124,568 $630,138 $543,222 $439,500 The company's income statements for the years ended December 31, 2017 and 2016, follow. 2017 2016 $819,179 $646,434 $499,699 $420,182 For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense Income taxes 253,945 163,548 13,926 14,868 10,649 9,697 Total costs and expenses 778,2 608,295 Net income $ 40,960 $ 38,139 Earnings per share $ 2.52 $ 2.35 Calculate the company's long-term risk and capital structure positions at the end of 2017 and 2016 by computing (1) Debt and equity ratios. Debt Ratio Choose Numerator: | Choose Denominator: = Debt Ratio - II Debt ratio 2017: - = % 2016: - = % Equity Ratio Choose Numerator: | Choose Denominator: Equity Ratio Equity ratio - = 2017: % = = 2016: - % (2) Debt-to-equity ratio. Debt-To-Equity Ratio Choose Denominator: Choose Numerator: Debt-To-Equity Ratio Debt-to-equity ratio - = 2017: - = to 1 2016: - to 1 (3) Times interest earned. Times Interest Earned Choose Numerator: | Choose Denominator: Times Interest Earned - Times interest earned 2017: - = times 2016: IL - times