Accounting 26th Edition by Carl Warren,James Reeve,Jonathan Duchac

تمرين 28

Profitability ratios
Ralph Lauren Corp. sells men's apparel through company-owned retail stores. Recent financial information for Ralph Lauren follows (all numbers in thousands):

Assume the apparel industry average rate earned on total assets is 8.0%, and the average rate earned on stockholders' equity is 10.0% for the year ended April 2, Year 3.
a. Determine the rate earned on total assets for Ralph Lauren for fiscal Years 2 and 3. Round to one digit after the decimal place.
b. Determine the rate earned on stockholders' equity for Ralph Lauren for fiscal Years 2 and 3. Round to one decimal place.
c. Evaluate the two-year trend for the profitability ratios determined in (a) and (b).
d. Evaluate Ralph Lauren's profit performance relative to the industry.