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 Current Year $ 31,800 89,500 112,500 10,700 278,500 $ 523,000 1 Year Ago 2 Years Ago $ 37,800 50,200 54,000 5,000 230,500 $ 377,500 $ 129,900 98,500 163,500 131,100 $ 523,000 $ 35,625 62,500 82,500 9,375 255,000 $.445,000 Liabilities and Equity Accounts payable Long-term notes payable Common stock, $10 par value Retained earnings Total liabilities and equity For both the current year and one year ago, compute the following ratios: $ 75,250 101,500 163,500 104,750 $ 445,000 xercise 13-7 (Static) Analyzing liquidity LO P3 a) Compute the current ratio for each of the three years. b) Did the current ratio improve or worsen over the three-year period? -a) Compute the acid-test ratio for each of the three years. -b) Did the acid-test ratio improve or worsen over the three-year period? $ 51,250 83,500 163,500 79,250 $ 377,500
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 Current Year $ 31,800 89,500 112,500 10,700 278,500 $ 523,000 1 Year Ago 2 Years Ago $ 37,800 50,200 54,000 5,000 230,500 $ 377,500 $ 129,900 98,500 163,500 131,100 $ 523,000 $ 35,625 62,500 82,500 9,375 255,000 $.445,000 Liabilities and Equity Accounts payable Long-term notes payable Common stock, $10 par value Retained earnings Total liabilities and equity For both the current year and one year ago, compute the following ratios: $ 75,250 101,500 163,500 104,750 $ 445,000 xercise 13-7 (Static) Analyzing liquidity LO P3 a) Compute the current ratio for each of the three years. b) Did the current ratio improve or worsen over the three-year period? -a) Compute the acid-test ratio for each of the three years. -b) Did the acid-test ratio improve or worsen over the three-year period? $ 51,250 83,500 163,500 79,250 $ 377,500
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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