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Company A and Company B have the same total assets, Return on Assets (ROA), and profit margin. However, Company A has higher liability-to-asset ratio and
Company A and Company B have the same total assets, Return on Assets (ROA), and profit margin. However, Company A has higher liability-to-asset ratio and interest expense than Company B. Which of the following statements is most correct?
. a. Company A has a lower total assets turnover than Company B.
b. Company A has a lower operating income (EBIT) than Company B.
c. Company A has a lower net income than Company B.
d. Company A has a lower ROE than Company B.
e. Company A has a higher equity multiplier (EM) than Company B.
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