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Company 1 2 3 Debt Equity Ratio 0.2 0.3 0.5 Inventory Turnover 4 60 - Current Ratio 1.8 0.9 1.28 Net Profit Margin 3.8% 6.4%

Company
1 2 3
Debt Equity Ratio 0.2 0.3 0.5
Inventory Turnover 4 60 -
Current Ratio 1.8 0.9 1.28
Net Profit Margin 3.8% 6.4% 20%
Receivables Turnover 30 - 6.0

Part A) Which of the following companies could potentially be?

a Bubble-Tea Store

a Bike Store

a Consulting Firm

Provide a reason to Justify your answers.

Part B) If the managers focus on the current stock value, they will tend to overemphasize short-term profits at the expense of long-term profits?

Is this statement true? Justify Why or Why not?

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