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 Current Year 1 Year Ago $ 32,242 90,726 112,930 10,282 284,381 $530,561 Income tax expense Total costs and expenses Net income Earnings per share $ 36,224 63,393 82,923 9,701 265,139 $ 457,380 Liabilities and Equity Accounts payable Long-term notes payable Common stock, $10 par value. $ 132,110 98,748 162,500 137,203 Retained earnings. Total liabilities and equity $ 530,561 The company's income statements for the current year and one year ago, follow. Current Year 1 Year Ago For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense $ 420,735 213,816 11,725 8,966 $ 75,751 107,301 162,500 111,828 $ 457,380 $ 689,729 2 Years Ago $ 38,496 49,804 55,763 4,235 236,702 $385,000 655,242 $ 34,487 2.12 $ 49,804 87,638 162,500 85,058 $385,000 $ 353,783 137,703 12,518 8,164 $ 544,282 512,168 $ 32,114 $1.98 S (1) Compute debt and equity ratio for the current year and one year ago. Current Year: 1 Year Ago: Current Year: 1 Year Ago: Numerator: Numerator: Debt Ratio Equity Ratio 1 Denominator: Denominator: Debt Ratio Debt ratio "1 % =Equity Ratio Equity ratio % % (2-a) Compute debt-to-equity ratio for the current year and one year ago. (2-b) Based on debt-to-equity ratio, does the company have more or less debt in the current year versus one year ago? Complete this question by entering your answers in the tabs below. Required 2A Required 28 Compute debt-to-equity ratio for the current year and one year ago. Debt-To-Equity Ratio Current Year: 1 Year Ago: Numerator: 1 Denominator: to 1 to 1 (2-a) Compute debt-to-equity ratio for the current year and one year ago. (2-b) Based on debt-to-equity ratio, does the company have more or less debt in the current year versus one year ago? Complete this question by entering your answers in the tabs below. Required 2A Required 281 Based on debt-to-equity ratio, does the company have more or less debt in the current year versus one year ago? Based on debt-to-equity ratio, the company has debt in the current year versus one year ago. = = = Times Interest Earned Times interest earned times times (3-a) Compute times interest earned for the current year and one year ago. (3-b) Based on times interest earned, is the company more or less risky for creditors in the Current Year versus 1 Year Ago? Complete this question by entering your answers in the tabs below. Required 3A Required 38 Based on times interest earned, is the company more or less risky for creditors in the Current Year versus 1 Year Ago? Based on times interest earned, the company is for creditors in the current year versus one year ago.
