90.2K

Verified Solution

Link Copied!

Simon Company's year-end balance sheets follow. Current Yr 1 Yr Ago 2 Yrs Ago 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 Common stock, $10 par value Retained earnings Total liabilities and equity $ 37,161 109,857 132,707 11,728 338,388 $629, 841 $ 43,003 $ 43,477 76,015 57,970 100,449 64,881 11,516 4,782 311,983 272,490 $ 542,966 $ 443,600 $161,535 120,778 162,500 185,028 $629,841 $ 92,679 $ 60,312 123,633 98,036 162,500 162,500 164, 154 122,752 $ 542,966 $ 443,600 The company's income statements for the current year and one year ago, follow. For Year Ended December 31 Current Yr Sales 1 Yr Ago Cost of goods sold $818,793 $646,130 $499,464 Other operating expenses $419,985 Interest expense 253,826 163, 471 13,919 14,861 Income tax expense 10,644 Total costs and expenses 9,692 777,853 608,899 Net income $ 48,940 $ 38,121 Earnings per share 5 2.52 $ 2.35 For both the current year and one year ago, compute the following ratios: (3-a) Times interest earned. (3-6) Based on times interest eamed. Is the company more or less risky for creditors in the Current Year versus 1 Year Ago? Complete this question by entering your answers in the tabs below. Required 3A Required 38 Times interest earned Choose Numerator Times Interest Emned Choose Denominator Times Interest Earned Times interest med O times Current Year: 1 Year Ago: 1 O times Required 38 >

Answer & Explanation Solved by verified expert

See Answer