Compare The Gap Inc. (FA3-2) and American Eagle Outfitters Inc. (FA3-3) liquidity positions for Year 2. Comment on the differences.
In FA3-2, The Gap Inc. operates over 3,000 specialty retail stores under such brand names as GAP, Old Navy, and banana republic. The following asset and liability data (in millions) were adapted from recent financial statements.

In FA3-3, American eagle Outfitters Inc. operates over 1,000 specialty retail stores, selling clothing such as denim, sweaters, t-shirts, and fleece outerwear. The following asset and liability data (in millions) were adapted from recent financialstatements.

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Year 2 Year 1 Current assets Cash Accounts receivable Inventory Prepaid and other current assets 745 89 378 75 $1,287 S 405 734 85 301 54 1,174 S 388 Total current assets Total current liabilities