For the year ended January 31:

(Dollars in thousands)	2005	2004	2003	2002
Net Sales	$6,039,750	$5,452,010	$4,558,060	$3,362,910
Cost of Goods	3,573,070	3,135,730	2,616,710	1,903,480
Gross Profit	2,466,680	2,316,280	1,941,350	1,459,430
Selling, General and Administrative Expenses (including depreciation)	2,221,540	1,849,100	1,434,860	1,076,990
Income from Operations	245,140	467,180	506,490	382,440
Other Income (expenses):
Interest and other income	14,470	19,510	27,250	14,410
Interest Expense	(10,180)	(13,990)	(12,320)	(13,570)
Income Before Income Taxes	249,430	472,700	521,420	383,280
Income Tax Provision	102,000	181,990	198,600	162,080
Net Income	$147,430	$290,710	$322,820	$221,200

(As a Percentage of Sales)
Net Sales	100.0%	100.0%	100.0%	100.0%
Cost of Goods	59.2	57.5	57.4	56.6
Gross Profit	40.8	42.5	42.6	43.4
Selling, General and Administrative Expenses (including depreciation)	36.8	33.9	31.5	32.0
Income from Operations	4.0	8.6	11.1	11.4
Other Income (expenses): Interest and other income	.3	.4	.6	.4
Interest Expense	(.2)	(.3)	(.3)	(.4)
Income Before Income Taxes	4.1	8.7	11.4	11.4
Income Tax Provision	1.7	3.4	4.3	4.8
Net Income	2.4%	5.3%	7.1%	6.6%

Figure 2. (Cont.) K-L Fashions, Inc. Financial Statements

Balance Sheet

January 31:

(Dollars in thousands)	2005	2004	2003	2002
Assets
Current Assets:
Cash and Cash Equivalents	$272,640	$82,540	$321,390	$281,750
Receivables	12,090	3,480	7,550	2,740
Inventory	738,630	857,090	668,200	464,440
Prepaid Expenses	54,880	54,030	39,670	33,630
Total Current Assets	1,078,240	997,140	1,036,810	782,560
Property, Plant & Equipment (at cost):
Land and Buildings	531,270	383,350	312,670	151,140
Fixtures and equipment	476,460	411,230	251,920	219,740
Leasehold improvements	16,460	15,120	12,340	9,080
Construction in progress	----	46,370	32,800	6,740
Less Accumulated Depreciation	(248,430)	(183,890)	(135,020)	(99,470)
Property, Plant & Equipment, net	775,760	672,180	474,710	287,230
Total Assets	$1,854,000	$1,669,320	$1,511,520	$1,069,790
Liabilities and Stockholders Equity
Current Liabilities:
Accounts Payable	$377,970	$244,150	$259,040	$212,223
Advance Payment on Orders	4,460	2,030	3,500	4,530
Income Taxes Payable	70,800	53,020	103,970	53,940
Other Current Obligations	154,510	139,950	148,790	117,900
Total Current Liabilities	607,740	439,150	515,300	388,600
Long-Term Debt	78,000	84,130	76,740	86,670
Stockholders Equity:
Common Stock; 20.1M, 20.1M &20.0M Shares, respectively, at par	2,010	2,010	2,000	2,000
Additional Capital, net	311,360	307,810	293,080	223,080
Retained Earnings	983,810	875,160	624,400	341,666
Less Treasury Stock, at cost	(128,920)	(38,940)	----	----
Total Stockholders Equity	1,168,260	1,146,040	919,480	566,740
Total Liabilities and Equity	$1,854,000	$1,669,320	$1,511,520	$1,069,790

Figure 2. K-L Fashions, Inc. Financial Statements

Statement of Cash Flows

(Major component totals only)

For the year ended January 31:

(Dollars in thousands)

	2005	2004	2003	2001
Net cash flows from operating activities	$ 512,020	$ 95,200	$ 255,600	$ 217,030
Net cash flows from investing activities	(175,410)	(250,560)	(226,690)	(52,310)
Net cash flows from financing activities	(146,510)	( 83,490)	10,730	(43,290)
Net increase (decrease) In cash and cash equivalents	$ 190,100	$(238,850)	$39,640	$121,430

- Apply common size on income statement (please do not use consistent year -- if you use 2003, the second year should be 2005.

-Apply comparative analysis on balance with two years

-Create the statement of cash flow with indirect method based on the information from your calculation on balance sheet

-measure a company debt to assets ratio, and asset turn over.

-Interpretation on each statement - income statement; balance sheet and statement of cashflow

- interpretation on each ratio

-conclusion.