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
[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 $ 28,557 $ 34,393 $ 34,772 Accounts receivable, net 82,768 58,417 47,309 Merchandise inventory 103,014 78,753 50,893 Prepaid expenses 9,104 8,763 3,864 Plant assets, net 265,471 241,152 221,562 Total assets $ 488,914 $ 421,478 $ 358,400 Liabilities and Equity Accounts payable $ 118,087 $ 71,230 $ 47,782 Long-term notes payable 92,835 95,001 78,414 Common stock, $10 par value 163,500 162,500 162,500 Retained earnings 114,492 92,747 69,704 Total liabilities and equity $ 488,914 $ 421,478 $ 358,400 (1-a) Compute the current ratio for each of the three years. (1-b) Did the current ratio improve or worsen over the three-year period? (2-a) Compute the acid-test ratio for each of the three years. (2-b) Did the acid-test ratio improve or worsen over the three-year period?
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