Simon Company's year-end balance sheets follow.

At December 31	Current Year	1 Year Ago	2 Years Ago
Assets
Cash	$ 32,605	$ 39,278	$ 40,506
Accounts receivable, net	99,320	67,376	53,473
Merchandise inventory	117,601	89,033	58,099
Prepaid expenses	11,036	9,902	4,412
Plant assets, net	303,337	280,531	248,610
Total assets	$ 563,899	$ 486,120	$ 405,100
Liabilities and Equity
Accounts payable	$ 139,007	$ 82,976	$ 54,543
Long-term notes payable	102,833	112,926	89,527
Common stock, $10 par value	162,500	162,500	162,500
Retained earnings	159,559	127,718	98,530
Total liabilities and equity	$ 563,899	$ 486,120	$ 405,100

For both the current year and one year ago, compute the following ratios:

Exercise 13-11 (Algo) Analyzing profitability LO P3

The companys income statements for the Current Year and 1 Year Ago, follow.

For Year Ended December 31	Current Year		1 Year Ago
Sales		$ 733,069		$ 578,483
Cost of goods sold	$ 447,172		$ 376,014
Other operating expenses	227,251		146,356
Interest expense	12,462		13,305
Income tax expense	9,530		8,677
Total costs and expenses		696,415		544,352
Net income		$ 36,654		$ 34,131
Earnings per share		$ 2.26		$ 2.10

Additional information about the company follows.

Common stock market price, December 31, Current Year	$ 28.00
Common stock market price, December 31, 1 Year Ago	26.00
Annual cash dividends per share in Current Year	0.32
Annual cash dividends per share 1 Year Ago	0.16

For both the current year and one year ago, compute the following ratios:

1. Return on equity.

2. Dividend yield.

3a. Price-earnings ratio on December 31.

3b. Assuming Simon's competitor has a price-earnings ratio of 7, which company has higher market expectations for future growth?

For both the current year and one year ago, compute the following ratios: Exercise 13-11 (Algo) Analyzing profitability LO P3 The company's income statements for the Current Year and 1 Year Ago, follow. Additional information about the company follows. For both the current year and one year ago, compute the following ratios: 1. Return on equity. 2. Dividend yield. 3a. Price-earnings ratio on December 31 . 3b. Assuming Simon's competitor has a price-earnings ratio of 7, which company has higher market expectations for future growth? Complete this question by entering your answers in the tabs below. Compute the return on equity for each year