Question
East Point Retail, Inc. sells apparel through company-owned retail stores. Recent financial information for East Point follows (in thousands): Fiscal Year 3 Fiscal Year 2
East Point Retail, Inc. sells apparel through company-owned retail stores. Recent financial information for East Point follows (in thousands):
Fiscal Year 3 | Fiscal Year 2 | |||||
Net income | $157,300 | $81,000 | ||||
Interest expense | 3,200 | 12,100 | ||||
Fiscal Year 3 | Fiscal Year 2 | Fiscal Year 1 | ||||
Total assets (at end of fiscal year) | $2,082,437 | $1,980,855 | $1,743,145 | |||
Total stockholders' equity (at end of fiscal year) | 1,185,620 | 1,162,142 | 862,858 |
Assume the apparel industry average return on total assets is 5.0% and the average return on stockholders' equity is 8.0% for the year ended February 2, Year 3.
a. Determine the return on total assets for East Point for fiscal Years 2 and 3. Round percentages to one decimal place.
Fiscal Year 3 | % |
Fiscal Year 2 | % |
b. Determine the return on stockholders equity for East Point for fiscal Years 2 and 3. Round percentages to one decimal place.
Fiscal Year 3 | % |
Fiscal Year 2 | % |
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