Westmoreland Company

Following are selected data from Westmoreland Company's financial statements.

	2018	2017
Current liabilities	$230,000	$160,000
Long-term debt	120,000	320,000
Stockholders' equity	420,000	540,000
Cash payments for additions to plant and equipment	45,000	32,000
Net cash flow from operating activities	80,000	51,000
Interest and principal payments	12,000	8,000
Net operating cash flows before interest and taxes	68,000	43,000
Net income	90,000	72,000
Interest expense	8,500	11,500
Income taxes	16,000	14,500
Dividends paid	15,000	30,000

Refer to the Westmoreland Company data.

The company's debt-to-equity ratio was 0.83 to 1 in 2018 and 0.89 to 1 in 2017. Which of the following statements is true concerning Westmoreland?

a.The company relied more on creditors for financing during 2018 than in 2017.

b.The company appears to be in a weaker position at the end of 2018 to finance capital expenditures from cash flow generated by operating activities.

c.The company is improving its debt-to-equity ratio.

d.The company has a smaller percentage of capital from owners at the end of 2018 than at the end of 2017.