Refer to the financial statements of Abercrombie & Fitch given in Appendix C at the end of this book, or open file ANF.pdf in the Annual Report Cases directory on the student CD-ROM.

Required: 1. What does the company include in its category of cash and cash equivalents? How close do you think the disclosed amount is to actual fair market value? 2. What expenses does Abercrombie & Fitch subtract from net sales in the computation of gross profit? How does this differ from Timberland's practice and how might it affect the manner in which you interpret the gross profit percentage? 3. Compute Abercrombie & Fitch's receivables turnover ratio for the year ended February 3, 2001

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What characteristics of its business might cause it to be so high? 4. What was the change in accounts receivable and how did it affect net cash provided by operating activities for the current year?