Financial information for American Eagle is presented in Appendix A at the end of the book.

Required:

1. Complete the “Amount” and “%” columns to be used in a horizontal analysis of American Eagle’s income statement for the year ended February 2, 2013.

2. Calculate the following risk ratios for the year ended February 2, 2013:

a. Receivables turnover ratio.

b. Average collection period.

c. Inventory turnover ratio.

d. Average days in inventory.

e. Current ratio.

f. Acid-test ratio.

g. Debt to equity ratio.

3. Calculate the following profitability ratios for the year ended February 2, 2013:

a. Gross profit ratio.

b. Return on assets.

c. Profit margin.

d. Asset turnover.

e. Return on equity.