Problem

Comparing Companies within an IndustryRefer to the financial statements of American Eagle...

Comparing Companies within an Industry

Refer to the financial statements of American Eagle Outfitters in Appendix B. Urban Outfitters in Appendix C. and the Industry Ratio Report in Appendix D at the end of this book.

Required:

1. Compute the current ratio for both companies. Compared to the industry average (from the Industry Ratio Report), are these two companies more or less able to satisfy short-term obligations with current assets? How is the current ratio influenced by these companies’ choice to rent space instead of buying it?

2. In the most recent year, how much cash, if any. was spent buying back (repurchasing) each company’s own common stock?

3. How much, if any. did each company pay in dividends for the most recent year?

4. What account title or titles does each company use to report any land, buildings, and equipment it mav have?

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