East Point Retail, Inc. sells apparel through company-owned retail stores. Recent financial information for East Point follows (in thousands): Fiscal Year 3 Fiscal Year 2 Net income $149,300 $76,800 Interest expense 3,000 11,500 Fiscal Year 3 Fiscal Year 2 Fiscal Year 1 Total assets (at end of fiscal year) $1,334,252 $1,269,166 $1,117,320 Total stockholders' equity (at end of fiscal year) 1,100,679 1,078,883 794,287 Assume the apparel industry average return on total assets is 5.0% and the average return on stockholders' equity is 8.0% for the year ended February 2, Year 3. a. Determine the return on total assets for East Point for fiscal Years 2 and 3. Round percentages to one decimal place. Fiscal Year 3 % Fiscal Year 2 % b. Determine the return on stockholders' equity for East Point for fiscal Years 2 and 3. Round percentages to one decimal place. Fiscal Year 3 Fiscal Year 2 % c. The return on stockholders' equity is the return on total assets due to the use of leverage. d. During fiscal Year 3, East Point's results were v compared to the industry average. These relationships suggest that East Point's has leverage than the industry, on average.

East Point Retail, Inc. sells apparel through company-owned retail stores. Recent financial information for East Point follows (in thousands): Fiscal Year 3 Fiscal Year 2 Net income $149,300 $76,800 Interest expense 3,000 11,500 Fiscal Year 3 Fiscal Year 2 Fiscal Year 1 Total assets (at end of fiscal year) $1,334,252 $1,269,166 $1,117,320 Total stockholders' equity (at end of fiscal year) 1,100,679 1,078,883 794,287 Assume the apparel industry average return on total assets is 5.0% and the average return on stockholders' equity is 8.0% for the year ended February 2, Year 3. a. Determine the return on total assets for East Point for fiscal Years 2 and 3. Round percentages to one decimal place. Fiscal Year 3 % Fiscal Year 2 % b. Determine the return on stockholders' equity for East Point for fiscal Years 2 and 3. Round percentages to one decimal place. Fiscal Year 3 Fiscal Year 2 % c. The return on stockholders' equity is the return on total assets due to the use of leverage. d. During fiscal Year 3, East Point's results were v compared to the industry average. These relationships suggest that East Point's has leverage than the industry, on average.

Name: ### Profitability RatiosEast Point Retail, Inc. sells apparel through
Uploaded: 2022-11-29T14:11:17.000Z
Channel: Bartleby
Description: ### Profitability RatiosEast Point Retail, Inc. sells apparel through company-owned retail stores. Recent financial information for East Point follows (in thousands):| | Fiscal Year 3 | Fiscal Year 2 ||-----------------------

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

Durable Plastics Company had the following total assets, liabilities, and equity as of December 31. Total Assets Total Liabilities Total Equity $440,000 133,000 307,000 What is the company's debt ratio as of December 31? (Round your percentage answer to two decimal places.) OA. 30.23% OB. 43.32% O C. 100.00% O D. 69.77%
The income statement for Cullumber, Inc. is as follows: CULLUMBER, INC. Income Statement For the Year Ended December 31, 2021 Sales revenue $442,000 Cost of goods sold 264,000 Gross profit 178,000 Expenses (including $19,000 interest and $36,700 income taxes) 114.000 Net income $64,000 Additional information: 1 2 Common stock outstanding January 1, 2021 was 44,000 shares and 54,000 shares were outstanding at December 31, 2021. The market price of Cullumber, Inc., stock was $16 in 2021. 3. Cash dividends of $17,130 were paid, $1,770 of which were to preferred stockholders. Compute the following measures for 2021: (Round Earnings per share to 2 decimal places, eg. 52.75. Round other answers to 1 decimal place, e.g. 52.7.) (a) Earnings per share $ (b) Price-earnings ratio (c) Payout ratio (d) Times interest earned 1.31 12.2 times 26.7 % times
Examine the following selected financial information for Best Value Corporation and Modern Stores, Inc., as of the end of their fiscal years ending in 2018: Data table (In millions) Best Value Corporation Modern Stores, Inc. 1. Total assets. . . . . . . . . . . . . . . . . . . . . . . . . . $15,256 $203,110 2. Total common stockholders' equity. . . . . $3,075 $71,460 3. Operating income. . . . . . . . . . . . . . . . . . . . $1,350 $26,820 4. Interest expense. . . . . . . . . . . . . . . . . . . . . . $88 $2,020 5. Leverage ratio. . . . . . . . . . . . . . . . . . . . . . . . 6. Total debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. Debt ratio. . . . . . . . . . . . . . . . . . . . . . . . . . . . 8. Times interest earned. . . . . . . . . . . . . . . . . Requirements…
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.
BC Training reports sales revenue of $2,800,000. Average inventory during the year was $130,000. The inventory turnover ratio for the year is 8.0.What amount of gross profit would the company report in its income statement? Gross profit
5
The income statement for Sunland, Inc. is as follows:
Selected income statement data follow for Harper, Inc., for the year ended December 31 (in thousands). What is the company's times interest earned ratio? Operating income before interest Interest expense Operating income after interest Income tax Income after tax 35.6 30.6 11.2 24.4 6,617 189 6.428 1,607 4,821
The Intramural Sports Club reports sales revenue of $602,000. Inventory at both the beginning and end of the year totals $110,000. The inventory turnover ratio for the year is 4.1. What amount of gross profit does the company report in its income statement? THE INTRAMURAL SPORTS CLUB Income Statement (partial)
Profitability Ratios East Point Retal, Inc. seils apparel through company-owned retail stores. Recent financial information for East Point follows (in thousands): Fiscal Year 3 Fiscal Year 2 $145,000 $(74,600) 3,000 11,200 Fiscal Year 3 Fiscal Year 2 Fiscal Year 1 Net income (los) Interest expense Total assets (at and of fiscal year) Total stockholders equity (at end of fiscal year) Assume the apparel industry average return on total assets is 5.0% and the average return on stockholders' equity is 8.0% for the year ended February 2, Year 3. $1,307,759 1,010,000 Fiscal Year 3 Fiscal Year 2 $1,243,965 990,000 $1,106,719 724,942 a. Determine the return on total assets for East Point for fiscal Years 2 and 3. Round percentages to one decimal place. If required, use a minus sign to indicate a negative return on total assets. % b. Determine the retum on stockholders' equity for East Point for fiscal Years 2 and 3. Round percentages to one decimal place. If required, use a minus sign to…
Profitability Ratios East Point Retail, Inc., sells apparel through company-owned retail stores. Financial information for East Point follows (in thousands): Fiscal Year 3 Fiscal Year 2 Net income Interest expense Fiscal Year 3 $144,900 3,000 Total assets (at end of fiscal year) $1,897,402 $1,677,598 Total stockholders' equity (at end of fiscal year) 1,017,383 737,911 Assume the apparel industry average return on total assets is 8.0%, and the average return on stockholders' equity is 15.0% for the year ended April 2, Year 3. Fiscal Year 2 a. Determine the return on total assets for East Point for fiscal Years 2 and 3. Round your answers to one decimal place. Fiscal Year 2 $74,600 11,200 7.4 X % % Fiscal Year 3 Fiscal Year 2 Fiscal Year 1 % b. Determine the return on stockholders' equity for East Point for fiscal Years 2 and 3. Round your answers to one decimal place. Fiscal Year 3 % $1,994,704 1,037,937

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS