! Required information [The following information applies to the questions displayed below.] Simon Company's year-end balance sheets follow. At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Current Year 1 Year Ago 2 Years Ago $ 33,782 $ 40,697 68,399 100,908 123,104 11,323 315,147 91,316 10,683 292,581 $ 503,676 $ 41,553 54,861 57,849 4,617 252,620 $ 411,500 $ 55,948 91,851 162,500 $ 584,264 $ 148,391 $ 85,972 117,004 162,500 138,200 101,201 Total liabilities and equity $ 584,264 $ 503,676 $ 411,500 Long-term notes payable Common stock, $10 par value Retained earnings 107,645 163,500 164,728 1. Express the balance sheets in common-size percents. 2. Assuming annual sales have not changed in the last three years, is the change in accounts receivable as a percentage of total assets favorable or unfavorable? 3. Assuming annual sales have not changed in the last three years, is the change in merchandise inventory as a percentage of total assets favorable or unfavorable?