Solvency and profitability ratios. (LO 3)

Use the financial statements for Talbots to calculate the following solvency and profitability ratios for FYE January 28,2006 . What information does this provide about the firm's solvency and profitability?

a. Debt-to-equity ratio

b. Times-interest-earned ratio

c. Return on assets

d. Return on equity

e. Gross margin percentage

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Assets Current Assets: The Talbots, Inc. and Subsidiaries Consolidated Balance Sheets (Amounts in thousande except share data). January 25, 2006 January 29, 2006 Cash and cash equivalents 8 103,020 $ 31,811 Customer accounts receivable-net 209,749 199,256 Merchandise inventories 246,707 238.544 Deferred catalog costs 6,021 5,118 Due from affiliates 7,892 9,073 Deferred income taxes 14,115 14,006 Prepaid and other current assets 33,157 29,589 Total current assets 620,661 527,397 Property and equipment-net 387,536 405,114 Deferred income taxes 6,407 Goodwill-net Trademarks-net Other assets Total Assets 35,519 35,513 75,884 75,884 20,143 18,222 $1,146,144 $1,062,130