Which of the following statements is correct?
A) If Company A has a higher debt ratio that Company B, then we can be sure that A will have a lower times-interest-earned ratio than B.
B) Suppose two companies have identical operations in terms of sales, cost of goods sold, interest rate on debt, and assets. However, Company A used more debt than Company B; that is, Company A has a higher debt ratio. Under these conditions, we would expect B's profit margin to be higher than A's.
C) The ROE of any company which is earning positive profits and which has a positive net worth (or common equity) must exceed the company's ROA.
D) Statements a, b, and c are all true.
E) Statements a, b, and c are all false.
B
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A. Trends. B. Study of absolute amounts. C. Percentages. D. All of these answers are correct.
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Answer the following statement true (T) or false (F)
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Indicate whether the statement is true or false
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