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In: Operations Management

Simon Company’s year-end balance sheets follow. At December 31 Current Yr 1 Yr Ago 2 Yrs...

Simon Company’s year-end balance sheets follow.

At December 31 Current Yr 1 Yr Ago 2 Yrs Ago
Assets
Cash $ 33,469 $ 39,122 $ 41,164
Accounts receivable, net 97,984 71,230 54,337
Merchandise inventory 119,500 92,298 60,815
Prepaid expenses 11,214 10,270 4,437
Plant assets, net 310,838 281,050 255,047
Total assets $ 573,005 $ 493,970 $ 415,800
Liabilities and Equity
Accounts payable $ 138,398 $ 85,151 $ 56,532
Long-term notes payable secured by
mortgages on plant assets		 106,648 115,885 89,135
Common stock, $10 par value 162,500 162,500 162,500
Retained earnings 165,459 130,434 107,633
Total liabilities and equity $ 573,005 $ 493,970 $ 415,800


(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?

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keosha answered 2 years ago
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