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Use the following information for the Exercises below. ( Algo ) Skip to question [ The following information applies to the questions displayed below. ]

Use the following information for the Exercises below. (Algo)
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[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 $ 34,403 $ 41,421 $ 41,069
Accounts receivable, net 101,70670,37552,611
Merchandise inventory 126,62292,99658,329
Prepaid expenses 10,85810,5564,429
Plant assets, net 309,521287,333250,262
Total assets $ 583,110 $ 502,681 $ 406,700
Liabilities and Equity
Accounts payable $ 142,291 $ 87,502 $ 52,611
Long-term notes payable 111,817112,14890,780
Common stock, $10 par value 162,500162,500162,500
Retained earnings 166,502140,531100,809
Total liabilities and equity $ 583,110 $ 502,681 $ 406,700
For both the current year and one year ago, compute the following ratios:
Exercise 17-7(Algo) Analyzing liquidity LO P3
(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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