Simon Company's year-end balance sheets follow. At December 31 Current Yr 1 Yr Ago 2 Yrs Ago Assets Cash $ 36,935 $ 41,463 $ 42,370 Accounts receivable, net 109,168 77,049 58,205 Merchandise inventory 133,260 98,850 60,159 Prepaid expenses 11,894 11,445 4,660 Plant assets, net 328,558 305,516 266,906 Total assets $ 619,815 $ 534,323 $ 432,300 Liabilities and Equity Accounts payable $ 158,964 $ 90,301 $ 56,493 Long-term notes payable secured bymortgages on plant assets 114,195 120,436 96,494 Common stock, $10 par value 163,500 163,500 163,500 Retained earnings 183,156 160,086 115,813 Total liabilities and equity $ 619,815 $ 534,323 $ 432,300 1. Express the balance sheets in common-size percents. (Do not round intermediate calculations and round your final percentage answers to 1 decimal place.)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?

Century 21 Accounting General Journal

11th Edition

ISBN:9781337680059

Author:Gilbertson

Publisher:Gilbertson

Chapter16: Financial Statements And Closing Entries For A Corporation

Section: Chapter Questions

Problem 5AP

See similar textbooks

Related questions

Question

100%

Simon Company's year-end balance sheets follow.

At December 31	Current Yr	1 Yr Ago	2 Yrs Ago
Assets
Cash		$	36,935	$	41,463	$	42,370
Accounts receivable, net			109,168		77,049		58,205
Merchandise inventory			133,260		98,850		60,159
Prepaid expenses			11,894		11,445		4,660
Plant assets, net			328,558		305,516		266,906
Total assets		$	619,815	$	534,323	$	432,300
Liabilities and Equity
Accounts payable		$	158,964	$	90,301	$	56,493
Long-term notes payable secured by mortgages on plant assets			114,195		120,436		96,494
Common stock, $10 par value			163,500		163,500		163,500
Retained earnings			183,156		160,086		115,813
Total liabilities and equity		$	619,815	$	534,323	$	432,300

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

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 4 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions