3. Ralph Lauren Corporation sells apparel through company-owned stores. Recent financial information for Ralph Lauren is as follows: Net Income Interest Expense Total Assets (at end of fiscal year) Total Stockholders (at end of fiscal year) Fiscal Year 3 $567,600 18,300 Fiscal Year 3 $4,981,000 3,304,700 Fiscal Year 2 $479,500 22,200 Fiscal Year 2 $4,648,900 3,116,600 Fiscal Year 1 $4,356,500 2,735,000
3. Ralph Lauren Corporation sells apparel through company-owned stores. Recent financial information for Ralph Lauren is as follows: Net Income Interest Expense Total Assets (at end of fiscal year) Total Stockholders (at end of fiscal year) Fiscal Year 3 $567,600 18,300 Fiscal Year 3 $4,981,000 3,304,700 Fiscal Year 2 $479,500 22,200 Fiscal Year 2 $4,648,900 3,116,600 Fiscal Year 1 $4,356,500 2,735,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:3. Ralph Lauren Corporation sells apparel through company-owned stores. Recent financial
information for Ralph Lauren is as follows:
Net Income
Interest Expense
Total Assets (at end of fiscal year)
Total Stockholders (at end of fiscal year)
Fiscal Year 3
$567,600
18,300
Fiscal Year 3
$4,981,000
3,304,700
Fiscal Year 2
$479,500
22,200
Fiscal Year 2
$4,648,900
3,116,600
Fiscal Year 1
$4,356,500
2,735,000
Assume that the apparel industry average return on total assets is 8.0% and the average
return on stockholders' equity is 10.0% for the year ended April 2, Year 3.
Required:
a. Determine the return on total assets for Ralph Lauren for fiscal year 2 and 3.
b. Determine the return on stockholders' equity for Ralph Lauren for fiscal Years 2 and 3.
c. Evaluate the two year trend for the profitability ratios determined in (a) and (b)
d. Evaluate Ralph Lauren's profit performance relative to the industry.
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