Which of the Following Statements Is Most Correct

question 3

Multiple Choice

Which of the following statements is most correct?

• A) If two companies have the same return on equity, they should have the same stock price.
• B) If Company A has a higher profit margin and higher total assets turnover relative to Company B, then Company A must have a higher return on assets.
• C) If Company A and Company B have the same debt ratio, they must have the same times interest earned (TIE) ratio.
• D) Answers b and c are correct.
• E) None of the answers above is correct.

---

Definitions:

Maintenance Supplies

Items and materials used in the routine care, repair, and upkeep of machinery, buildings, and equipment to ensure operational efficiency and safety.

Supply Planning Process

The proactive method of coordinating assets to optimize the supply of products and services.

Sales Forecast

The process of estimating future sales, based on historical data, industry comparisons, and market analysis, to guide business planning.

Production Forecast

A projection of the quantity of goods or services a company plans to produce over a specific period, based on demand predictions and resource availability.