The following table presents a selection of financial ratios for CoffeeBean and TeaLeaf, two businesses that operate in the same industry:

Require:

Classify the above ratios into the categories of profitability, asset efficiency, liquidity and capital structure.

Compare the ratio results of the two businesses. Based on your analysis, identify and explain which company would be considered the better investment.

Coffee Bean 1 times 1.5 days 0.57 TeaLeaf 0.6 times 35 days 1.6 Asset turnover Debtors days Current Ratio Total debt to equity ratio Profit margin Quick Ratio Return on equity (ROE) Return on assets (ROA) 105.42% 7.40% 1.09 265.73% 5.34% 1.2 (15.7)% 2.42% 25.6% 5.90%