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Companies HD and LD have identical tax rates, total assets, and EBIT. However, Company HD has a higher debt/equity ratio and thus more interest expense
Companies HD and LD have identical tax rates, total assets, and EBIT. However, Company HD has a higher debt/equity ratio and thus more interest expense than Company LD. Which of the following statements is CORRECT? Recall return on assets ROA = Net Income/Total Assets. = Company HD has a higher net income than Company LD. O The two companies have the same ROA. O Company HD has a lower ROA than Company LD. Cannot be determined from the information provided
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