Question

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 $ 29,888 $ 33,889 $ 37,120
Accounts receivable, net 86,626 61,751 47,553
Merchandise inventory 108,915 83,215 52,721
Prepaid expenses 9,914 8,896 3,963
Plant assets, net 271,239 248,958 226,243
Total assets $ 506,582 $ 436,709 $ 367,600
Liabilities and Equity
Accounts payable $ 123,616 $ 73,804 $ 48,523
Long-term notes payable secured by
mortgages on plant assets
97,142 97,430 81,240
Common stock, $10 par value 163,500 163,500 163,500
Retained earnings 122,324 101,975 74,337
Total liabilities and equity $ 506,582 $ 436,709 $ 367,600


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?

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