Required informationUse the following information for the Exercises below. $($Algo$)$Skip to question$[$The following information applies to the questions displayed below.$]$Simon Company's year$-$end balance sheets follow.At December $31$Current Year$1$ Year Ago$2$ Years AgoAssets Cash$ $31,714$$ $37,445$$ $37,858$Accounts receivable, net$90,05966,18350,477$Merchandise inventory$117,90188,32355,387$Prepaid expenses$10,6259,7314,206$Plant assets, net$292,648266,376234,472$Total assets$ $542,947$$ $468,058$$ $382,400$Liabilities and Equity Accounts payable$ $137,898$$ $77,520$$ $50,982$Long$-$term notes payable$102,074105,50083,665$Common stock, $$10$ par value$162,500163,500162,500$Retained earnings$140,475121,53885,253$Total liabilities and equity$ $542,947$$ $468,058$$ $382,400$For both the current year and one year ago, compute the following ratios:Exercise $13-6($Algo$)$ Common$-$size percents LO P$2$Express the balance sheets in common$-$size percents.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?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?