Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please answer in text(without image) it is easy to copy East Point Retail, Inc., sells professional women's apparel through company-owned retail stores. Recent financial Information

please answer in text(without image) it is easy to copy

image text in transcribed

East Point Retail, Inc., sells professional women's apparel through company-owned retail stores. Recent financial Information for East Point is provided below (all numbers in thousands). Fiscal Year 3 Fiscal Year 2 Net income $134,300 $69,200 Interest expense 2,700 10,300 Fiscal Year 3 Fiscal Year 2 Fiscal Year 1 Total assets (at end of fiscal year) $2,194,141 $2,087,109 $1,887,891 Total stockholders' equity (at end of fiscal year) 968,879 949,693 697,927 Assume the apparel industry average return on total assets is 8.0%, and the average return on stockholders' equity is 15.0% for the year ended April 2, Year 3. a. Determine the return on total assets for East Point for fiscal Years 2 and 3. Round 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 to one decimal place. Fiscal Year 3 % Fiscal Year 2 % c. The return on stockholders' equity is greater than the return on total assets due to the positive use of leverage d. During fiscal Year 3, East Point's results were weak average. The return on stockholders' equity was less Industry, on average. compared to the industry average. The return on total assets for East Point was less than the industry than the industry average. These relationships suggest that East Point has less leverage than the

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

Step: 3

blur-text-image

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

ISE Fundamental Managerial Accounting Concepts

Authors: Thomas Edmonds, Christopher Edmonds, Mark Edmonds, Philip Olds

9th Edition

1260565483, 9781260565485

More Books

Students also viewed these Accounting questions

Question

In what form does radiant energy travel?

Answered: 1 week ago

Question

Appreciate the rationale for having a human resources department.

Answered: 1 week ago

Question

What are some global employee and labor relations problems?

Answered: 1 week ago