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Exercise 13-9 Analyzing risk and capital structure LO P3

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[The following information applies to the questions displayed below.] Simon Companys year-end balance sheets follow.

At December 31	Current Yr					1 Yr Ago			2 Yrs Ago
Assets
Cash		$	26,804			$	31,015		$	31,357
Accounts receivable, net			80,040				57,045			41,809
Merchandise inventory			98,662				71,722			46,353
Prepaid expenses			8,719				8,224			3,626
Plant assets, net			244,668				227,591			200,055
Total assets		$	458,893			$	395,597		$	323,200
Liabilities and Equity
Accounts payable		$	116,550			$	66,856		$	42,662
Long-term notes payable secured by mortgages on plant assets			86,272				88,258			71,427
Common stock, $10 par value			162,500				162,500			162,500
Retained earnings			93,571				77,983			46,611
Total liabilities and equity		$	458,893			$	395,597		$	323,200

The companys income statements for the Current Year and 1 Year Ago, follow.

For Year Ended December 31	Current Yr						1 Yr Ago
Sales				$	596,561					$	470,760
Cost of goods sold	$	363,902					$	305,994
Other operating expenses		184,934						119,102
Interest expense		10,142						10,827
Income tax expense		7,755						7,061
Total costs and expenses					566,733						442,984
Net income				$	29,828					$	27,776
Earnings per share				$	1.84					$	1.71

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 Ratio Debt ratio = 11 % Current Year: 1 Year Ago: 11 % Equity Ratio se Numerator: Cho De tor: = Equity Ratio Equity ratio % = Current Year: 1 Year Ago: 1 = %