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Companies HD and LD have identical tax rates, total assets, total investor-supplied capital, operating income (EBIT), and business risk. However, Company HD has a higher

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Companies HD and LD have identical tax rates, total assets, total investor-supplied capital, operating income (EBIT), and business risk. However, Company HD has a higher debt ratio and thus more interest expense than Company LD. Which of the following statements is CORRECT? O The two companies have the same return on invested capital (ROIC) and the same return on equity (ROE). O Company HD has a higher return on equity (ROE) than Company LD. O Company HD has a higher net income than Company LD. O Company HD has a lower return on equity (ROE) than Company LD and its bankruptcy risk as measured by the standard deviation of ROE is also lower than LD's O Company HD has a higher times interest earned (TIE) ratio than Company LD

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