Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] 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 $ 25,693 75,195 91,790 7,868 226,383 $ 426,929 1 Year Ago $ 106,305 81,065 162,500 77,059 $426,929 $ 30,032 51,526 68,088 7,729 210,667 $368,042 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: 2 Years Ago $ 60,955 86,343 163,500 57,244 $368,042 $ 31,284 40,485 44,871 3,408 189,752 $ 309,800 $ 40,894 66,412 163,500 38,994 $ 309,800

Corporate Fin Focused Approach
5th Edition
ISBN:9781285660516
Author:EHRHARDT
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Chapter3: Analysis Of Financial Statements
Section: Chapter Questions
Problem 15SP
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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?
Complete this question by entering your answers in the tabs below.
Required 1A Required 1B Required 2A Required 2B
Compute the current ratio for each of the three years.
Current Year:
1 Year Ago:
2 Years Ago:
Numerator:
1
1
1
1
1
Current Ratio
Denominator:
< Required 1A
=
II
=
II
Current Ratio
Current ratio
to 1
to 1
to 1
Required 1B >
Transcribed Image Text: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? Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 2A Required 2B Compute the current ratio for each of the three years. Current Year: 1 Year Ago: 2 Years Ago: Numerator: 1 1 1 1 1 Current Ratio Denominator: < Required 1A = II = II Current Ratio Current ratio to 1 to 1 to 1 Required 1B >
Required information
Use the following information for the Exercises below. (Algo)
[The following information applies to the questions displayed below.]
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.
Current Year
$ 25,693
75,195
91,790
7,868
226,383
$426,929
1 Year Ago
$ 30,032
51,526
68,088
7,729
210,667
$ 368,042
2 Years Ago
$ 60,955
86,343
$ 106,305
81,065
162,500
$ 40,894
66,412
163,500
163,500
57,244
77,059
38,994
$ 426,929 $ 368,042 $ 309,800
$ 31,284
40,485
44,871
3,408
189,752
$ 309,800
For both the current year and one year ago, compute the following ratios:
Transcribed Image Text:Required information Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] 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. Current Year $ 25,693 75,195 91,790 7,868 226,383 $426,929 1 Year Ago $ 30,032 51,526 68,088 7,729 210,667 $ 368,042 2 Years Ago $ 60,955 86,343 $ 106,305 81,065 162,500 $ 40,894 66,412 163,500 163,500 57,244 77,059 38,994 $ 426,929 $ 368,042 $ 309,800 $ 31,284 40,485 44,871 3,408 189,752 $ 309,800 For both the current year and one year ago, compute the following ratios:
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I need this format for the second required, thank you

(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?
Complete this question by entering your answers in the tabs below.
Required 1A Required 1B Required 2A Required 2B
Compute the acid-test ratio for each of the three years.
Current Year:
1 Year Ago:
2 Years Ago:
Current assets
+ Short-term investments
+
+
Numerator:
+
Acid-test ratio
+
+
+
+
< Required 1B
1
1
1
1
1
Denominator:
Required 2B
>
=
=
=
Acid-Test Ratio
Acid-test ratio
0 to 1
0 to 1
0 to 1
Transcribed Image Text:(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? Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 2A Required 2B Compute the acid-test ratio for each of the three years. Current Year: 1 Year Ago: 2 Years Ago: Current assets + Short-term investments + + Numerator: + Acid-test ratio + + + + < Required 1B 1 1 1 1 1 Denominator: Required 2B > = = = Acid-Test Ratio Acid-test ratio 0 to 1 0 to 1 0 to 1
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