Which of the following statements is correct?
A)If two firms have the same ROA, the firm with the most debt can be expected to have the lower ROE.
B)An increase in the DSO, other things held constant, could be expected to increase the total assets turnover ratio.
C)An increase in the DSO, other things held constant, could be expected to increase the ROE.
D)An increase in a firm's debt ratio, with no changes in its sales or operating costs, could be expected to lower the profit margin.

Question

Quizplus · Accepted Answer

The Answer of Which of the following statements is correct?
A)If two firms have the same ROA, the firm with the most debt can be expected to have the lower ROE.
B)An increase in the DSO, other things held constant, could be expected to increase the total assets turnover ratio.
C)An increase in the DSO, other things held constant, could be expected to increase the ROE.
D)An increase in a firm's debt ratio, with no changes in its sales or operating costs, could be expected to lower the profit margin.

Which of the Following Statements Is Correct