Question: Use the financial statements for GameStop Corp. to calculate the following solvency ratios and profitability for the most recent fiscal year and provide an interpretation
Use the financial statements for GameStop Corp. to calculate the following solvency ratios and profitability for the most recent fiscal year and provide an interpretation for each ratio:
1. Debt- to- equity ratio
2. Profit margin ratio
3. Return on assets
4. Return on equity
5. Gross marginpercentage
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GameStop Corp. Consolidated Statements of Operations in thousandb, except per share data 53 Weeks Ended 52 Weeks Ended January 31, 2009 52 Weeks Ended February 2,February 3, 2008 2007 Cost of sales 6535762 Gross profit.._.. ..__ . Selling, general and administrative ..2,270,135 1,813,707 1,471,442 Depreciation and amortization 145,004 130,270 109,862 4,593 6,788 Interest income...11,619 (13,779) (11,338) 50,456 Interest expense Debt extinguishment expense . 84,662 254,296 $398282 288 291 158260 61,553 . Earnings before income tax expense. 633,951 441,056 235,669 Net earnings per common sharebasie .244 163,190 .2.38 167,671 1.82 1.06 Weighted average shares of common Net earnings per common share-dlluted Weighted average shares of common 1.75 $ 1.00 stock diluted.. 164,844 158,284
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