Rolf Company and Kent Company are similar firms that operate in the same industry. Kent began operations in 2011 and Rolf in 2008. In 2013, both companies pay 7% interest on their debt to creditors. The following additional information is available.

Rolf COMPANY Kent COMPANY

201320122011 201320122011

Total asset turnover . . . . . .3.02.72.9 1.61.41.1

Return on total assets . . ..8.9%9.5%8.7% 5.8%5.5%5.2%

Profit margin . . . . . . . . ..2.3%2.4%2.2% 2.7%2.9%2.8%

Sales . . . . . . . . . . . . .$400,000 $370,000 $386,000 $200,000 $160,000 $100,000

Compare Rolf and Kent using the available information. Their ability to use assets efficiently to produce profits. Also comment on their success in employing financial leverage in 2013.