Consider the following financial data for Smith Corp.:

Statement of Financial Position as of December $31,2025$

Cash & equivalents

$

$94,000$

Accounts payable $

$30,000$

Receivables

$100,000$

Notes payable

$92,000$

Inventories

$72,000$

Accrued wages & taxes

$41,000$

Total current assets

$

$266,000$

Total current liabilities $

$163,000$

Long$-$term debt

$257,000$

Net fixed assets

$592,500$

Common equity

$438,500$

Total assets

$

$858,500$

Total liab. & equity $

$858,500$

Income Statement for $2025$

Industry Average Ratios

Sales revenue

$

$755,500$

Current ratio

$1\mathrm{.}4$

Cost of sales

$468,500$

Quick ratio

$1\mathrm{.}0$

Gross profit

$

$287,000$

Days sales outstanding

$39$ days

Operating expenses

$213,000$

COGS$/$Inventory

$9\mathrm{.}6$

EBIT

$

$74,000$

Total asset turnover

$1\mathrm{.}2$

Interest expense

$33,000$

Net profit margin

$4\mathrm{.}3\%$

Pre$-$tax income

$

$41,000$

Return on assets

$5\mathrm{.}2\%$

Income taxes $(25\%)$

$10,250$

Return on equity

$9\mathrm{.}0\%$

Net earnings

$

$30,750$

Debt$-$to$-$capital ratio

$36\%$

Compared to other firms in the same industry, Smith...

Group of answer choices

generates more profit per dollar of total assets.

is better able to meet its short$-$term obligations.

uses more equity financing.

has a shorter average collection period for receivables.

has a higher profit margin.