Consider the following financial data for Smith Corp.:

Balance Sheet as of December 31, 2019
Cash	$	195,000		Accounts payable	$	94,000
Receivables		185,500		Short-term bank note		119,500
Inventories		214,500		Accruals		71,000
Total current assets	$	595,000		Total current liabilities	$	284,500
				Long-term debt		462,500
Net plant & equip.		621,500		Common equity		469,500
Total assets	$	1,216,500		Total liab. & equity	$	1,216,500
Profit & Loss Statement for 2019				Industry Average Ratios
Net sales	$	1,265,000		Current ratio		1.9
Cost of sales		986,500		Quick ratio		1.2
Gross profit	$	278,500		Days sales outstanding		64 days
Operating expenses		166,500		Inventory turnover		3.3
EBIT	$	112,000		Total asset turnover		0.7
Interest expense		32,000		Net profit margin		9.1%
Pre-tax income	$	80,000		Return on assets		6.8%
Income taxes (30%)		24,000		Return on equity		15.2%
Net income	$	56,000		Debt-to-capital ratio		41%

Compared to its competitors, Smith...

	a.	obtains more of its capital from equity financing.
	b.	converts its receivables to cash more slowly.
	c.	is more likely to have trouble paying its short-term debts.
	d.	has a higher return on equity.
	e.	is using its total assets to generate sales more efficiently.