Selected information for two companies competing in the retail clothing industry
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Selected information for two companies competing in the retail clothing industry

4. Selected information for two companies competing in the retail clothing industry presented below.


Required

a. Analyse and compare the profitability of Forever30 and Bardod. Provide calculations to support your analysis.

b. From your calculations in part (a), explain the different business approaches the two con have adopted.

c. Explain how increasing the proportion of debt to assets can affect profitability ratios.

Hint
Accounts & FinanceTotal-debt-to-total-assets ratio shows the degree to which a company has mainly used it's debt to finance its assets. Also, it's calculation considers all of the debt of the company and also considers all assets, which includes the intangibles. And, the total-debt-to-total-assets ratio is basically calculated by dividing the total amount of debt of the company by the company'...

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