4.25 Calculating and Interpreting Profitability Ratios. Abercrombie & Fitch sells casual apparel and personal care...
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Calculating and Interpreting Profitability Ratios. Abercrombie & Fitch sells casual apparel and personal care products for men, women, and children through retail stores located primarily in shopping malls. Its fiscal year ends January of each year. Financial statements for Abercrombie & Fitch for fiscal years ending January Year Year and Year appear in Exhibit balance sheets Exhibit income statements and Exhibit statements of cash flows These financial statements reflect the capitalization of operating leases in property, plant, and equipment and longterm debt, a topic discussed in Chapter Exhibit page presents financial statement ratios for Abercrombie & Fitch for Years and Selected data for Abercrombie & Fitch appear here.
REQUIRED
a Calculate the ratios in Exhibit for Year The income tax rate is
b Analyze the changes in ROA for Abercrombie & Fitch during the threeyear period, suggesting possible reasons for the changes observed.
c Analyze the changes in ROCE for Abercrombie & Fitch during the threeyear period, suggesting possible reasons for the changes observed.
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