Compute, Disaggregate, and Interpret RNOA of Competitors Selected balance sheet and income statement information for the clothing retailers, Abercrombie & Fitch and The GAP, Inc., follows.

Abercrombie & Fitch	ANF	$2,785	$330	$533	$331
The GAP	GPS	$16,023	$1,083	$2,896	$2,745

(a) Compute the 2006 return on net operating assets (RNOA) for each company. (Do not round until your final answer.Round your answers to two decimal places. Do not use RNOA = NOPM x NOAT to calculate.)

Abercrombie & Fitch	Answer%
The GAP	Answer%

(b) Disaggregate RNOA into net operating profit margin (NOPM) and net operating asset turnover (NOAT) for each company. (Do not round until your final answer.Round your answers to two decimal places.)

Abercrombie & Fitch	Answer%	Answer
The GAP	Answer%	Answer

(c) Which of the following statements about business models bests explains differences between the RNOA for ANF and GPS?

GPS reports a higher RNOA because it is a much larger company.GPS reports a lower RNOA because its asset turnover rate is substantially lower than ANF's.ANF reports a higher RNOA because its net profit margin is higher than GPS's.ANF reports a higher RNOA because its NOA is about one-fourth that for GPS