Firm A has an Asset Turnover of 2 and Average days sales (average collection) of 5. Firm B has an Asset turnover of 1.6 and Average days sales (average collection) of 3. Which of the following is a proper interpretation?

Select one:

a. Firm A has riskier operations than Firm B, but Firm B has more liquidity than Firm A.

b. Firm A is more efficient with their inventory than Firm B, but Firm B is more efficient with their accounts payables than Firm A.

c. Firm A generates more sales with their assets than Firm B, but Firm B is more efficient with collecting on their accounts receivables than Firm A.

d. Firm A is more profitable than Firm B, and Firm A is more efficient than Firm B with collecting on their accounts receivables.

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