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Computing Fair Value of Environmental Liability Minerals Inc. anticipates environmental costs at the end of a 10-year production cycle. Due to the uncertainties of the
Computing Fair Value of Environmental Liability Minerals Inc. anticipates environmental costs at the end of a 10-year production cycle. Due to the uncertainties of the remedies available in 10 years, the company has developed the following estimates. In answering the following questions, round your answers to the nearest whole number, using no negative signs. Selected income statement and balance sheet information follows for American Eagle Outfitters Inc. and Abercrombie \& Fitch Co. from recent Form 10-K reports. Answer the following questions. - Note: Round to the nearest whole dolllar a. Calculate return on equity for the current fiscal year for each company. a. Calculate return on equity for the current fiscal year for each company. b. Disaggregate return on equity to its DuPont components of profitability (profit margin), activity (asset turnover), and leverage (financial leverage) for each company. Demonstrate how the product of the components is equal to return on equity. c. Analyze the results. What are the drivers for the differences (if any) between the ratios of the two companies, assuming all differences are material? As compared to Abercrombie \& Fitch Co., American Eagle Outfitters Inc. has a: Indicated by the profit margin Indicated by the asset turnover
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