Exercise 13-9 Analyzing risk and capital structure LO P3 The following information applies to the questions displayed below.) Simon Company's year-end balance sheets follow. Current Yr 1 Yr Ago 2 Yrs Ago $ 36, 138 107, 945 135, 720 11, 638 333,567 $625, 008 $ 44, 397 $ 45, 340 77, 695 58, 675 98,681 62, 483 11,428 4,890 306,599 277,612 $ 538,800 $ 449,000 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 secured by mortgages on plant assets Common stock, $10 par value Retained earnings Total liabilities and equity $160, 296 $ 91,968 $ 58, 675 121, 027 162,500 181, 185 $625, 008 127, 642 99, 229 162,500 162,500 156, 690 128, 596 $ 538, 800 $449, 000 The company's income statements for the Current Year and 1 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 Yr $812, 510 $495, 631 251,878 13, 813 10,563 771, 885 $ 40, 625 1 Yr Ago $ 641, 172 $416,762 162, 217 14, 747 9,618 603, 344 $ 37, 828 $ 2.33 S 2.50 For both the Current Year and 1 Year Ago, compute the following ratios: Exercise 13-9 Part 1 (1) Debt and equity ratios. Debt Ratio Choose Numerator: Choose Denominator: Debt and Debt ratio % % 11 Current Year: 1 Year Ago: Equity Ratio Choose Numerator: Choose Denominator: Equity Ratio Equity ratio % = = 1 Current Year: % 1 Year Ago