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 Accounts payable Long-term notes payable Common stock, $10 par value Retained earnings Total liabilities and equity Income tax expense Total costs and expenses Net income Earnings per share Current Year 1 Year Ago 2 Years Ago $ 35,333 $ 35,005 $ 29,030 89,343 109,060 61,833 46,673 78,472 51,234 9,091 252,561 4,048 223,840 $ 437,290 $ 360,800 9,445 270,378 $ 507,256 $ 126,307 $ 75,380 102,588 96,318 162,500 122,131 162,500 96,822 $ 507,256 $ 437,290 The company's income statements for the current year and one year ago, follow. Current Year 1 Year Ago For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense Current Year: 1 Year Ago: Numerator: $ 402,254 204,424 11,210 8,573 $659,433 626,461 $ 32,972 $ 2.03 Complete this question by entering your answers in the tabs below. Required 2A Required 28 Compute debt-to-equity ratio for the current year and one year ago. Debt-To-Equity Ratio $ 49,054 79,737 (2-0) Compute debt-to-equity ratio for the current year and one year ago. (2-b) Based on debt-to-equity ratio, does the company have more or less debt in the current year versus one year ago? Denominator: 162,500 69,509 $360,800 "1 $ 338,244 131,655 11,969 7,806 $ 520,375 489,674 $ 30,701 $ 1.89 Debt-To-Equity Ratio Debt-to-equity ratio 0 to 1 0 to 1

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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(1) Compute debt and equity ratio for the current year and one year ago.
Current Year:
1 Year Ago:
Current Year:
1 Year Ago:
Numerator:
Prepaid expenses
Plant assets, net
Total assets
Numerator:
Accounts receivable, net
Merchandise inventory
Liabilities and Equity
Accounts payable
Long-term notes payable
Common stock, $10 par value
Retained earnings
Total liabilities and equity
Simon Company's year-end balance sheets follow.
At December 31
Assets
Cash
Income tax expense
Total costs and expenses
Net income
Earnings per share
Debt Ratio
Required 2A Required 28
Current Year:
1 Year Ago:
1
Equity Ratio
1
Numerator:
1
1
Denominator:
Denominator:
$ 29,030
89,343
109,060
9,445
270,378
$ 507,256
$ 126,307
96,318
162,500
122,131
$ 507,256
$ 402,254
284,424
11,210
8,573
Complete this question by entering your answers in the tabs below.
Debt-To-Equity Ratio
Compute debt-to-equity ratio for the current year and one year ago.
$ 75,380
102,588
162,500
96,822
$ 437,298
$ 659,433
626,461
$ 32,972
$ 2.03
Current Year 1 Year Ago 2 Years Ago
$ 35,333
$ 35,005
61,833
46,673
78,472
51,234
4,848
9,891
252,561
223,848
$360,800
$ 437,290
The company's income statements for the current year and one year ago, follow.
Current Year
1 Year Ago
For Year Ended December 31
Sales
Cost of goods sold
Other operating expenses
Interest expense
Denominator:
=
=
=
=
=
=
=
=
B
Debt Ratio
Debt ratio
(2-a) Compute debt-to-equity ratio for the current year and one year ago.
(2-b) Based on debt-to-equity ratio, does the company have more or less debt in the current year versus one year ago?
%
Equity Ratio
Equity ratio
96
$ 49,054
79,737
162,500
69,509
$360,800
$ 338,244
131,655
11,969
7,806
$ 520,375
489,674
$ 30,701
$ 1.89
= Debt-To-Equity Ratio
= Debt-to-equity ratio
0 to 1
0 to 1
Transcribed Image Text:(1) Compute debt and equity ratio for the current year and one year ago. Current Year: 1 Year Ago: Current Year: 1 Year Ago: Numerator: Prepaid expenses Plant assets, net Total assets Numerator: Accounts receivable, net Merchandise inventory Liabilities and Equity Accounts payable Long-term notes payable Common stock, $10 par value Retained earnings Total liabilities and equity Simon Company's year-end balance sheets follow. At December 31 Assets Cash Income tax expense Total costs and expenses Net income Earnings per share Debt Ratio Required 2A Required 28 Current Year: 1 Year Ago: 1 Equity Ratio 1 Numerator: 1 1 Denominator: Denominator: $ 29,030 89,343 109,060 9,445 270,378 $ 507,256 $ 126,307 96,318 162,500 122,131 $ 507,256 $ 402,254 284,424 11,210 8,573 Complete this question by entering your answers in the tabs below. Debt-To-Equity Ratio Compute debt-to-equity ratio for the current year and one year ago. $ 75,380 102,588 162,500 96,822 $ 437,298 $ 659,433 626,461 $ 32,972 $ 2.03 Current Year 1 Year Ago 2 Years Ago $ 35,333 $ 35,005 61,833 46,673 78,472 51,234 4,848 9,891 252,561 223,848 $360,800 $ 437,290 The company's income statements for the current year and one year ago, follow. Current Year 1 Year Ago For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense Denominator: = = = = = = = = B Debt Ratio Debt ratio (2-a) Compute debt-to-equity ratio for the current year and one year ago. (2-b) Based on debt-to-equity ratio, does the company have more or less debt in the current year versus one year ago? % Equity Ratio Equity ratio 96 $ 49,054 79,737 162,500 69,509 $360,800 $ 338,244 131,655 11,969 7,806 $ 520,375 489,674 $ 30,701 $ 1.89 = Debt-To-Equity Ratio = Debt-to-equity ratio 0 to 1 0 to 1
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