The Financial statements of X, Y and Z are being compared and the following data are given:

X Y Z

Current ratio 200% 50% 100%

Acid-test ratio 100% 30% 60%

Rate of return on sales 30% 60% 40%

Retained earnings to

capital stock 60% 300% 100%

Price earnings ratio 3 2 5

Debt-equity ratio 60% 150% 200%

Net cash inflow (outflow) from:

Operating activities (P10,000) (P5000) (P25000)

Investing activities 30,000 20,000 (8000)

Financing activities 50,000 10,000 8,000

Disregarding all other factors, answer the following questions and show solutions.

1. The company that provides the greatest margin of safety to creditors is?
2. in which company did acquisition costs of non-current assets exceed proceeds from disposals?
3. the increase in long-term debt and stockholder's equity of this company exceeds those in the other two companies.