Assets Cash. Accounts receivable, net $ 31,800 $ 35,625 $ 37,800 89,500 62,500 50,200 Merchandise inventory. 112,500 82,500 54,000 Prepaid expenses. 10,700 9,375 5,000 Plant assets, net. 278,500 255,000 230,500 Total assets... $523,000 $445,000 $377,500 Liabilities and Equity Accounts payable.. $129,900 $ 75,250 $ 51,250 Long-term notes payable. 98,500 101,500 83,500 Common stock, $10 par value. 163,500 163,500 163,500 Retained earnings.. 131,100 104,750 79,250 Total liabilities and equity. $523,000 $445,000 $377,500 Exercise 13-7 Analyzing liquidity P3 Refer to Simon Company's balance sheets in Exercise 13-6. (1) Compute the current ratio for each of the three years. Did the current ratio improve or worsen over the three-year period? (2) Compute the acid-test ratio for each of the three years. Did the acid-test ratio improve or worsen over the three-year period? Round ratios to two decimals.
Assets Cash. Accounts receivable, net $ 31,800 $ 35,625 $ 37,800 89,500 62,500 50,200 Merchandise inventory. 112,500 82,500 54,000 Prepaid expenses. 10,700 9,375 5,000 Plant assets, net. 278,500 255,000 230,500 Total assets... $523,000 $445,000 $377,500 Liabilities and Equity Accounts payable.. $129,900 $ 75,250 $ 51,250 Long-term notes payable. 98,500 101,500 83,500 Common stock, $10 par value. 163,500 163,500 163,500 Retained earnings.. 131,100 104,750 79,250 Total liabilities and equity. $523,000 $445,000 $377,500 Exercise 13-7 Analyzing liquidity P3 Refer to Simon Company's balance sheets in Exercise 13-6. (1) Compute the current ratio for each of the three years. Did the current ratio improve or worsen over the three-year period? (2) Compute the acid-test ratio for each of the three years. Did the acid-test ratio improve or worsen over the three-year period? Round ratios to two decimals.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Assets
Cash.
Accounts receivable, net
$ 31,800
$ 35,625
$ 37,800
89,500
62,500
50,200
Merchandise inventory.
112,500
82,500
54,000
Prepaid expenses.
10,700
9,375
5,000
Plant assets, net.
278,500
255,000
230,500
Total assets...
$523,000
$445,000 $377,500
Liabilities and Equity
Accounts payable..
$129,900
$ 75,250
$ 51,250
Long-term notes payable.
98,500
101,500
83,500
Common stock, $10 par value.
163,500
163,500
163,500
Retained earnings..
131,100
104,750
79,250
Total liabilities and equity.
$523,000
$445,000 $377,500
Exercise 13-7
Analyzing liquidity
P3
Refer to Simon Company's balance sheets in Exercise 13-6. (1)
Compute the current ratio for each of the three years. Did the current
ratio improve or worsen over the three-year period? (2) Compute the
acid-test ratio for each of the three years. Did the acid-test ratio
improve or worsen over the three-year period? Round ratios to two
decimals.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education