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 $ 25,493 76,147 $ 30,711 52,147 $ 31,978 Long-term notes payable Common stock, $10 par value Retained earnings Total liabilities and equity 94,793 8,545 235,918 $440,896 $ 109,783 82,060 71,019 7,742 218,464 $ 380,083 163,500 85,553 $440,896 $ 63,592 88,293 163,500 64,698 $ 380,083 For both the current year and one year ago, compute the following ratios: 1. Express the balance sheets in common-size percents. 40,567 45,422 3,519 192,114 $ 313,600 $ 40,567 68,613 163,500 40,920 $ 313,600 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? Complete this question by entering your answers in the tabs below. Req 1 Req 2 and 3 Complete this question by entering your answers in the tabs below. Req 1 Req 2 and 3 Express the balance sheets in common-size percents. (Do not round intermediate calcu answers to 1 decimal place.) SIMON COMPANY Common-Size Comparative Balance Sheets December 31 Current Year 1 Year Ago 2 Years Ago Assets Cash Accounts receivable, net Merchandise inventory % % % Prepaid expenses Plant assets, net Total assets % % 960 % Liabilities and Equity Accounts payable % 700 % % Long-term notes payable Common stock, $10 par Retained earnings Total liabilities and equity % % % < Req1 Req 2 and 3 >