Using vertical common-size analysis and restating the balance sheets using total assets as the benchmark to analyze changes at Tab between fiscal year 2003 and fiscal year 2005, an analyst would correctly conclude that Tab:

A. reduced its relative investment in inventory.

B. increased the role of intangible assets in its investments.

C. decreased its reliance on debt financing relative to equity financing.

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Tab, Inc., Income Statements for Fiscal Years 2003, 2004, and 2005 Amount (in millions of dollars) 2005 2004 2003 Revenues $25,000 $22,000 $21,000 Cost of sales 20,000 18,000 17,000 Gross profit $5,000 $4,000 $4,000 Selling, general, and administrative expenses 500 500 800 Operating income $4,500 $3.500 $3,200 Interest and other nonoperating expense 200 250 250 Earnings before income taxes $4,300 Income tax 1,410 $3,250 975 $2,950 885 Net income $2,890 $2,275 $2,065 Tab, Inc., Balance Sheets as of End of Fiscal Years 2003, 2004, and 2005 Amount (in millions of dollars) 2005 2004 2003 Cash, cash equiv., and marketable securities $200 $150 $100 Accounts receivable 1,800 1,350 900 Inventories 8,000 7.500 7,000 Total current assets $10,000 $9,000 $8,000 Net property, plant, and equipment $20,000 19,000 19,000 Intangible assets 1,000 1,000 1,000 Total assets $31,000 $29,000 $28,000 Accounts payable $500 $790 $615 Debt due in one year 1,000 1,000 1,000 Long-term debt 12,000 13,000 14,000 Shareholders' equity 17,500 14,210 12,385 Total liabilities and equity $31,000 $29,000 $28,000