Comparing Companies within an Industry Refer to the financial statements of American Eagle Outfitters (Appendix B) and

Question:

Comparing Companies within an Industry
Refer to the of American Eagle Outfitters (Appendix B) and Urban Outfitters (Appendix C) and the Industry Ratio Report (Appendix D) at the end of this book.
Required:
1. Compute the percentage of net fixed assets to total assets for both companies for the most recent year. Why do the companies differ?
2. Compute the percentage of gross fixed assets that has been depreciated for both companies for the most recent year. Why do you think the percentages differ?
3. Compute the fixed ratio for the most recent year presented for both companies. Which company has higher asset efficiency? Why?
4. Compare the fixed ratio for both companies to the industry average. Are these companies doing better or worse than the industry average in asset efficiency?

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Asset Turnover
Asset turnover is sales divided by total assets. Important for comparison over time and to other companies of the same industry. This is a standard business ratio.