Northern Goods and Southern Goods have similar levels of EBIT and depreciation. However, Northern Goods has a much higher cash coverage ratio. Given this, which of these statements is correct?

Multiple choice question.

Northern Goods is maximizing its return to stockholders.

Northern Goods is diluting its return to stockholders more than its competitors are.

Northern Goods is maximizing its use of financial leverage.

Northern Goods is maximizing the tax benefits of debt.