Required information (The following information applies to the questions displayed below.) Simon Company's year-end balance sheets follow. At December 31 Current Yr 1 Yr Ago 2 Yrs Ago Assets Cash $ 31,800 $ 35,625 $ 37,800 Accounts receivable, net 89,500 62,500 50,200 Merchandise inventory 112,500 82,500 54,000 Prepaid expenses 10,700 9, 375 5,000 Plant assets, net 278,500 255,000 230,500 Total assets $ 523,000 $445,000 $ 377,500 Liabilities and Equity Accounts payable $ 129,900 $ 75,250 $ 51,250 Long-term notes payable secured by mortgages on plant assets 98,500 101,500 83,500 Common stock, $10 par value 163,500 163,500 163,500 Retained earnings 131, 100 184,750 79,250 Total liabilities and equity $ 523,000 $445,000 $ 377,500 The company's income statements for the Current Year and 1 Year Ago, follow. Assume that all sales are on credit: For Year Ended December 31 Current Yr 1 Yr Ago Sales $673,500 $532,000 Cost of goods sold $411,225 $345,500 Other operating expenses 209,550 134,989 Interest expense 12,100 13,300 Income tax expense 9,525 8,845 Total costs and expenses 642,400 502,625 Net income $ 31,100 $ 29, 375 Earnings per share $ 1.90 $ 1.80 (1) Debt and equity ratios. Debt Ratio Choose Numerator: 1 Choose Denominator: Debt Ratio 1 = Debt ratio Current Year: / % 1 Year Ago: / % Equity Ratio Choose Numerator: 1 Choose Denominator: : Equity Ratio Equity ratio 1 1 % Current Year: : 1 Year Ago: / % (2) Debt-to-equity ratio Choose Numerator: Debt-To-Equity Ratio 1 Choose Denominator: 1 ! Debt-To-Equity Ratio Debt-to-equity ratio to 1 to 1 1 = Current Year: 1 Year Ago: 1 / (3-a) Times interest earned. (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 Times interest earned. Times Interest Earned 1 Choose Denominator: Choose Numerator: Times Interest Earned Times interest earned Current Year: times 1 Year Ago: 1 times (Required a Required 38 > (3-a) Times interest earned. (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? Times interest earned (1-a) Profit margin ratio. (1-1) Did profit margin improve or worsen in the Current Year versus 1 Year Ago? Complete this question by entering your answers in the tabs below. Required 1A Required 1B Did profit margin improve or worsen in the Current Year versus 1 Year Ago? Profit margin (3-a) Return on total assets 13-b) Based on return on total assets, did Simon's operating efficiency improve or worsen 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 return on total assets, did Simon's operating efficiency improve or worsen in the Current Year versus 1 Year Ago? ? Return on total assets (Required 3A Required 38 Additional information about the company follows. Connon stock market price, December 31, Current $30.00 Year Connon stock market price, December 31, 1 Year Ago 28.00 Annual cash dividends per share in Current Year 0.29 Annual cash dividends per share 1 Year Ago 0.24 For both the Current Year and 1 Year Ago, compute the following ratios: 1. Return on common stockholders' equity. 2. Price-earnings ratio on December 31. 2a. Assuming Simon's competitor has a price-earnings ratio of 10, which company has higher market expectations for future growth? 3. Dividend yield. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 2a Required 3 Compute the return on common stockholders' equity for each year. ' . Return On Common Stockholders' Equity Choose Denominator: Choose Numerator: 1 Return On Common Stockholders' Equity - Retum on common stockholders' equity % = % Current Year 1 1 Year Age 1 Required Required 2 > Additional information about the company follows. Common stock market price, December 31, Current Year Common stock market price, December 31, 1 Year Ago Annual cash dividends per share in Current Year Annual cash dividends per share 1 Year Ago $30.00 28.00 @.29 0.24 For both the Current Year and 1 Year Ago, compute the following ratios: 1. Return on common stockholders' equity. 2. Price-earnings ratio on December 31. 2a. Assuming Simon's competitor has a price-earnings ratio of 10, which company has higher market expectations for future growth? 3. Dividend yield Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 2a Required 3 Compute the price-earnings ratio for each year. (Round your answers to 2 decimal places.) . 2 Choose Numerator: Price-Earnings Ratio 1 Choose Denominator: 1 = Price-Earnings Ratio - Price-earnings ratio Current Year: 1 1 1 Year Ago: 1 Additional information about the company follows. Common stock market price, December 31, Current Year Common stock market price, December 31, 1 Year Ago Annual cash dividends per share in Current Year Annual cash dividends per share 1 Year Ago $30.00 28.00 0.29 0.24 For both the Current Year and 1 Year Ago, compute the following ratios: 1. Return on common stockholders' equity. 2. Price-earnings ratio on December 31, 2a. Assuming Simon's competitor has a price-earnings ratio of 10, which company has higher market expectations for future growth? 3. Dividend yield. Complete this question by entering your answers in the tabs below. Required 1 1 Required 2 Required 2a Required 3 Assuming Simon's competitor has a price-earnings ratio of 10, which company has higher market expectations for future growth? Which company has higher market expectations for future growth? Additional information about the company follows. . Common stock market price, December 31, Current Year Common stock market price, December 31, 1 Year Ago Annual cash dividends per share in Current Year Annual cash dividends per share 1 Year Ago $30.00 28.00 0.29 0.24 For both the Current Year and 1 Year Ago, compute the following ratios: 1. Return on common stockholders' equity 2. Price-earnings ratio on December 31. 2a. Assuming Simon's competitor has a price-earnings ratio of 10, which company has higher market expectations for future growth? 3. Dividend yield. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 2a Required 3 Compute the dividend yield for each year. (Round your answers to 2 decimal places.) Choose Numerator: Dividend Yield 1 Choose Denominator: 1 = Dividend Yield Dividend yield % Current Year: 1 Year Ago: 1 1 %