The companys income statements for the current year and one year ago, follow.
Required information Use the following information for the Exercises below. (Algo) [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 Ago Assets Cash $ 26, 691 $29.963 $ 30,618 Accounts receivable, net 75,060 55. 139 40.000 Merchandise inventory 94, 374 70.719 44.804 Prepaid expenses 8.510 8. 109 3.402 Plant assets.net 243, 271 222.196 193,576 Total assets $ 447.906 $ 386, 126 $ 312.400 Liabilities and Equity Accounts payable $ 108, 183 $ 66,560 $ 41.649 18-term notes payable 85, 890 88, 809 66, 969 Comon stock, $10 par value 163, 500 163,500 162.500 Retained earnings 90 333 67252 41.282 Total liabilities and equity $ 447,906 $ 386, 126 $ 312. 400 For both the current year and one year ago, compute the following ratios: Exercise 17-9 (Algo) Analyzing risk and capital structure LO P3 The company's income statements for the current year and one year ago, follow. For Year Ended December 31 Current Year 1 Year Ago Sales $ 582.278 $ 459, 490 Cost of goods sold $ 355. 190 $ 298, 669 Other operating expenses 180.506 116.251 Interest expense 9,899 10.568 Income tax expense 7570 6. 892 Total costs and expenses 553 165 432 380 Net income $ 29,113 $ 27. 110 Earnings per share $ 1.79 $ 1.67 (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? Complete this question by entering your answers in the tabs below. Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 2B Required 3A Required 38 Compute debt and equity ratio for the current year and one year ago. Debt Ratio Numerator: Denominator: Current Year: 1 Year Ago: = Debt Ratio Debt ratio 0 % 0 % Equity Ratio Numerator: Denominator: # Equity Ratio = Equity ratio 0 % = Current Year: 1 Year Ago: = 0 % Required Required 2A > Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 2B Required 3A Required 38 Compute debt-to-equity ratio for the current year and one year ago Debt-To-Equity Ratio Numerator: Denominator: 1 Current Year: 1 Year Ago: Debt-To-Equity Ratio Debt-to-equity ratio 0 to 1 0 to 1 = = (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 1 Required 2A Required 28 Required 3A Required 38 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 Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 28 Required 3A Required 38 Compute times interest earned for the current year and one year ago. Times Interest Earned Numerator: Denominator: Times Interest Earned Times interest eamed 0 times 0 times Current Year: 1 Year Ago: 1 Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 28 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 eamed, the company is for creditors in the current year versus one year ago
