Simon Companys year-end balance sheets follow.

At December 31	Current Yr					1 Yr Ago			2 Yrs Ago
Assets
Cash		$	31,800			$	35,625		$	37,800
Accounts receivable, net			89,500				62,500			50,200
Merchandise inventory			112,500				82,500			54,000
Prepaid expenses			10,700				9,375			5,000
Plant assets, net			278,500				255,000			230,500
Total assets		$	523,000			$	445,000		$	377,500
Liabilities and Equity
Accounts payable		$	129,900			$	75,250		$	51,250
Long-term notes payable secured by mortgages on plant assets			98,500				101,500			83,500
Common stock, $10 par value			163,500				163,500			163,500
Retained earnings			131,100				104,750			79,250
Total liabilities and equity		$	523,000			$	445,000		$	377,500

1. Express the balance sheets in common-size percents. 2. Assuming annual sales have not changed in the last three years, is the change in accounts receivable as a percentage of total assets favorable or unfavorable? 3. Assuming annual sales have not changed in the last three years, is the change in merchandise inventory as a percentage of total assets favorable or unfavorable?

Complete this question by entering your answers in the tabs below.

• Req 1
• Req 2 and 3

Express the balance sheets in common-size percents. (Do not round intermediate calculations and round your final percentage answers to 1 decimal place.)

SIMON COMPANY Common-Size Comparative Balance Sheets December 31 Current Year 1 Year Ago 2 Years Ago 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 Retained earnings Total liabilities and equity % % %

Assuming annual sales have not changed in the last three years, is the change in accounts receivable as a percentage of total assets favorable or unfavorable? Assuming annual sales have not changed in the last three years, is the change in merchandise inventory as a percentage of total assets favorable or unfavorable?

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	2. Change in accounts receivable 3. Change in merchandise inventory