In the years 2006-2009, B Co.'s capital expenditures ratio was 2.74 and from 2010-2013, it was 1.24. From 2010-2013, R Co.'s ratio was .30. Which of the following statements about B Co.'s capital expenditures ratio is correct?
A) B Co.'s ratio has improved in the period 2010-2013.
B) It appears that R Co. is more aggressive about investing in additional property, plant and equipment than is B Co.
C) It appears that B Co. is more aggressive about investing in additional property, plant and equipment than is R Co.
D) B Co.'s capital expenditures ratio is relatively low and indicates inability to finance property, plant and equipment with cash flow from operations.
Correct Answer:
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