Determine the return on total assets for ralph lauren

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Problem - Ralph Lauren Corporation (RL) sells apparel through company-owned retail stores. Financial information for Ralph Lauren follows (in thousands):

 

Fiscal Year 3

Fiscal Year 2


Net income

$396,400

$702,200


Interest expense

21,000

16,700


 

Fiscal Year 3

Fiscal Year 2

Fiscal Year 1

Total assets (at end of fiscal year)

$6,213,100

$6,106,000

$6,088,000

Total stockholders' equity (at end of fiscal year)

3,743,500

3,891,000

4,034,000

Assume the apparel industry average return on total assets is 8.0%, and the average return on stockholders' equity is 15.0% for the year ended April 2, Year 3.

Required -

a. Determine the return on total assets for Ralph Lauren for fiscal Years 2 and 3. Round percentages to one decimal place.

b. Determine the return on stockholders' equity for Ralph Lauren for fiscal Years 2 and 3. Round percentages 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.

Reference no: EM132719557

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