(1) Compute debt and equity ratio for the current year and one year ago. Current Year: 1 Year Ago: Current Year: 1 Year Ago: Debt Ratio Numerator: Denominator: = Debt Ratio = Debt ratio = % = % Equity Ratio Numerator: Denominator: = Equity Ratio = Equity ratio = % % 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 Current Year 1 Year Ago 2 Years Ago $ 26,925 $ 31,155 80,402 98,117 9,021 246,503 56,190 74,987 8,512 226,542 $ 460,968 $ 397,386 Accounts payable $ 113,633 Long-term notes payable Common stock, $10 par value Retained earnings 86,662 162,500 98,173 $ 67,158 93,227 162,500 74,501 Total liabilities and equity $ 460,968 $ 397,386 $ 33,778 44,154 47,974 3,680 204,914 $ 334,500 $ 43,712 71,707 162,500 56,581 $ 334,500 The company's income statements for the current year and one year ago, follow. 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 $ 599,258 $ 365,547 185,770 1 Year Ago $ 472,889 10,187 7,790 569,294 $ 29,964 $ 1.84 $ 307,378 119,641 10,876 7,093 444,988 $ 27,901 $ 1.72