Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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 %

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Liberalization In Developing Countries Issues Time Series Analyses And Policy Implications

Authors: Abdullahi Dahir Ahmed, Sardar M. N. Islam

1st Edition

3790828076, 978-3790828078

More Books

Students also viewed these Finance questions