Refer to the financial statements of Abercrombie & Fitch and Aeropostale that are supplied with this text.

Required:
1. Both Aeropostale (Note 14) and Abercrombie & Fitch (Note 16) have notes that discuss contingencies. What contingencies do they disclose? Do you think any of these contingencies are included in the income statement or on the balance sheet? Why or why not?

2. Both companies have notes providing detail on their accrued liabilities. Locate the note and provide the amount of gift card liability for 2009 for both companies.

3. Calculate Abercrombie & Fitch’s and Aeropostale’s current ratio for the years ended January 30, 2010, and January 31, 2009. 

4. Compare Abercrombie & Fitch’s and Aeropostale’s short-term liquidity based on the values and trends of the current ratio.

5. Calculate Abercrombie & Fitch’s and Aeropostale’s quick ratio and cash ratio for the years ended January 30, 2010, and January 31, 2009.

6. Compare the values and trends of these ratios when evaluating Abercrombie & Fitch’s and Aeropostale’s short-term liquidity.

7. Calculate Abercrombie & Fitch’s and Aeropostale’s operating cash flows ratio for the years ended January 30, 2010, and January 31, 2009.

8. Compare Abercrombie & Fitch’s and Aeropostale’s short-term liquidity based on the values and trends of the operating cash flows ratio.