Selected financial ratios for Canadian National Railway (CN) and Canadian Pacific Railway (CP) are presented here for a recent year.

	CN		CP
Liquidity
Current ratio	0.9:1		0.50:1
Acid-test ratio	0.7:1		0.4:1
Receivables turnover	6.0 times		9.0 times
Solvency
Debt to total assets	56.1%		69.0%
Interest coverage	9.2 times		7.7 times
Free cash flow	$3,302.0 million		$1,130.0 million
Profitability
Profit margin	25.8%		31.7%
Asset turnover	0.3 times		0.3 times
Return on assets	8.0%		10.6%
Return on equity	18.9%		34.0%

Instructions

1. Comment on the relative liquidity of the two companies.

2. Comment on the relative solvency of the two companies.

3. Comment on the relative profitability of the two companies.