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Two Companies Have the Same Sales Revenue for the Year

Question 9

Multiple Choice

Two companies have the same sales revenue for the year which equalled $22,550,000. Co. A has average total assets of $10,560,000 and current liabilities of $1,200,000. Co. B has average long-term liabilities of $3,750,000 in total shareholder equity of $5,610,000. When examining how well a company uses its assets


A) Co. B. is 2.4 times more efficient than Co. A
B) The data provided are insufficient to make a reliable comparison
C) Co. A. is as efficient as Co. B
D) Co. B. is more efficient than Co. A. by 12%
E) Co. A. is 3x more efficient than Co. B

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