#3-m24 i 4. 4 of 4 Simon Company's year-end balance sheets follow. At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Saved Current Year 1 Year Ago 2 Years Ago $ 34,608 89,800 114,000 11,145 319,936 $ 569,489 $ 40,453 62,700 82,500 10,619 294,667 $ 490,939 Accounts payable $ 146,057 Long-term notes payable Common stock, $10 par value Retained earnings 110,276 162,500 150,656 Total liabilities and equity $ 569,489 $ 490,939 $ 85,458 116,303 162,500 126,678 $ 40,502 50,800 57,000 4,500 244,398 $ 397,200 $ 54,003 90,415 162,500 90,282 $ 397,200 The company’s income statements for the current year and one year ago follow. Assume that all sales are on credit: 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 $ 740,336 $ 451,605 1 Year Ago $ 584,217 229,504 12,586 9,624 $ 37,017 $ 2.28 $ 379,741 147,807 13,437 8,763 703,319 549,748 $ 34,469 $ 2.12 (4-a) Compute days' sales in inventory. (4-b) For each ratio, determine if it improved or worsened in the current year. Help Save

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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#3-m24 i
4.
4 of 4
Simon Company's year-end balance sheets follow.
At December 31
Assets
Cash
Accounts receivable, net
Merchandise inventory
Prepaid expenses
Plant assets, net
Total assets
Liabilities and Equity
Saved
Current Year 1 Year Ago 2 Years Ago
$ 34,608
89,800
114,000
11,145
319,936
$ 569,489
$ 40,453
62,700
82,500
10,619
294,667
$ 490,939
Accounts payable
$ 146,057
Long-term notes payable
Common stock, $10 par value
Retained earnings
110,276
162,500
150,656
Total liabilities and equity
$ 569,489
$ 490,939
$ 85,458
116,303
162,500
126,678
$ 40,502
50,800
57,000
4,500
244,398
$ 397,200
$ 54,003
90,415
162,500
90,282
$ 397,200
The company’s income statements for the current year and one year ago follow. Assume that all sales are on
credit:
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
$ 740,336
$ 451,605
1 Year Ago
$ 584,217
229,504
12,586
9,624
$ 37,017
$ 2.28
$ 379,741
147,807
13,437
8,763
703,319
549,748
$ 34,469
$ 2.12
(4-a) Compute days' sales in inventory.
(4-b) For each ratio, determine if it improved or worsened in the current year.
Help Save
Transcribed Image Text:#3-m24 i 4. 4 of 4 Simon Company's year-end balance sheets follow. At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Saved Current Year 1 Year Ago 2 Years Ago $ 34,608 89,800 114,000 11,145 319,936 $ 569,489 $ 40,453 62,700 82,500 10,619 294,667 $ 490,939 Accounts payable $ 146,057 Long-term notes payable Common stock, $10 par value Retained earnings 110,276 162,500 150,656 Total liabilities and equity $ 569,489 $ 490,939 $ 85,458 116,303 162,500 126,678 $ 40,502 50,800 57,000 4,500 244,398 $ 397,200 $ 54,003 90,415 162,500 90,282 $ 397,200 The company’s income statements for the current year and one year ago follow. Assume that all sales are on credit: 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 $ 740,336 $ 451,605 1 Year Ago $ 584,217 229,504 12,586 9,624 $ 37,017 $ 2.28 $ 379,741 147,807 13,437 8,763 703,319 549,748 $ 34,469 $ 2.12 (4-a) Compute days' sales in inventory. (4-b) For each ratio, determine if it improved or worsened in the current year. Help Save
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