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 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 Earnings per share For both the Current Year and 1 Year Ago, compute the following ratios: Exercise 13-9 Part 2 (2) Debt-to-equity ratio. Debt-To-Equity Ratio Choose Numerator: Choose Denominator: Debt-To-Equity Ratio Debt-to-equity ratio to 1 11 Current Year: It to 1 1 Year Ago