Connect Access Card for Financial Accounting
9th Edition
ISBN: 9781259738678
Author: Robert Libby, Patricia Libby, Frank Hodge Ch
Publisher: McGraw-Hill Education
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Textbook Question
Chapter 8, Problem 8.3CP
Comparing Companies within an Industry
Refer to the financial statements of American Eagle Outfitters (Appendix B) and Urban Outfitters (Appendix C) and the Industry Ratio Report (Appendix D) at the end of this book.
Required:
- 1. Compute the percentage of net fixed assets to total assets (rounded to one decimal place) for both companies for the most recent year. Why do the companies differ?
- 2. Compute the percentage of gross fixed assets (rounded to one decimal place) that has been
depreciated for both companies for the most recent year. Why do you think the percentages differ? - 3. Compute the fixed asset turnover ratio (rounded to two decimal places) for the most recent year presented for both companies. Which company has higher asset efficiency? Why?
- 4. Compare the fixed asset turnover ratio for both companies to the industry average. Are these companies doing better or worse than the industry average in asset efficiency?
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Chapter 8 Solutions
Connect Access Card for Financial Accounting
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