Refer to the financial statements of American Eagle Outfitters given in Appendix B. Abercrombie &

Fitch given in Appendix C. and the Industry Ratio Report given in Appendix D at the end of this book, or open file CP9-3.xls in the Annual Report Cases directory on the student CD-ROM.

Required: 1. Compute the current ratio for each company for each year. 2. Compare the latest year current ratio for each company to the industr\ a\ erage from the Industn Ratio report. Based solely on the current ratio, are these companies more or less liquid than the average company in their industry'1 3. Compute the payable turnover ratio for each company for the current year. What is the amount o\

long-term liabilities for the current year? 4. Compare the latest j ear payable turnover ratio for each company to the industn a\ erage from the IndustT) Ratio report. Are these companies doing better or worse than the average COmpan) in their industr) at paying trade creditors? 5. Using this information and any other data from the annual report, write a brief assessment of the liquidity For the two companies.