Simon Company's year-end balance sheets follow. Current Year 1 Year Ago 2 Years Ago At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Long-term notes payable Common stock, $10 par value Retained earnings Total liabilities and equity $ 31,800 89,500 112,500 10,700 278,500 $ 523,000 $ 35,625 62,500 82,500 9,375 255,000 $ 445,000 $ 37,800 50,200 54,000 5,000 230,500 $ 377,500 $ 129,900 98,500 163,500 131, 100 $ 523,000 $ 75,250 101,500 163,500 104,750 $ 445,000 $ 51,250 83,500 163,500 79,250 $ 377,500 For both the current year and one year ago, compute the following ratios: The company's income statements for the current year and one year ago, follow. For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense Income tax expense Total costs and expenses Net income Earnings per share Current Year $ 673,500 $ 411,225 209,550 12,100 9,525 642,400 $ 31,100 $ 1.90 1 Year Ago $ 532,000 $ 345,500 134,980 13,300 8,845 502,625 $ 29,375 $ 1.80 (1) Debt and equity ratios. (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? (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? Required 1 Required 2A Required 2B Required 3A Required 3B Compute debt and equity ratio for the current year and one year ago. Debt Ratio 1 Numerator: Denominator: = = Debt Ratio Debt ratio 0 % 0 % II Current Year: 1 Year Ago: = Numerator: Equity Ratio 1 1 Denominator: II Equity Ratio Equity ratio 0 % 0 % Current Year: = 1 Year Ago: Required 1 Required 2A Required 2B Required 3A Required 3B II Compute debt-to-equity ratio for the current year and one year ago. Debt-To-Equity Ratio Numerator: 1 Denominator: Total liabilities 1 Total equity Current Year: 1 1 Year Ago: / Debt-To-Equity Ratio Debt-to-equity ratio 0 to 1 0 to 1 II Required 1 Required 2A Required 2B Required 3A Required 3B Compute times interest earned for the current year and one year ago. Times Interest Earned Numerator: Denominator: Times Interest Earned Times interest earned Current Year: 1 = 0 times 1 Year Ago: = 0 times