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 $ 37,051 $ 39,788 68,181 54,112 88,330 $ 32,677 93,761 121,459 10,734 295,219 $ 553,850 $ 139,288 Long-term notes payable Common stock, $10 par value Total liabilities and equity Retained earnings 103,083 162,500 148,979 9,926 273,969 $ 477,457 $ 79,076 108,717 163,500 126,164 $ 553,850 $ 477,457 For both the current year and one year ago, compute the following ratios: 55,928 4,421 247,651 $ 401,900 $ 51,459 87,932 162,500 100,009 $ 401,900 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?