Question: please show work! An analyst observes the following data for two companies: Which of the following choices best describes reasonable conclusions that the analyst might

please show work!
please show work! An analyst observes the following data for two companies:

An analyst observes the following data for two companies: Which of the following choices best describes reasonable conclusions that the analyst might make about the two companies' ability to pay their current and longterm obligations? Company A's current ratio of 4.0 indicates it is more liquid than Company B. whose current ratio is only 1.2, but Company B is more solvent, as indicated by its lower debt-to-equity ratio. Company A's current ratio of 0.25 indicates it is less liquid than Company B, whose current ratio is 0.83, and Company A is also less solvent, as indicated by a debt-to-equity ratio of 200 percent compared with Company B's debt-to-equity ratio of only 30 percent. Company A's current ratio of 4.0 indicates it is more liquid than Company B. whose current ratio is only 1.2, and Company A is also more solvent, as indicated by a debt-to-equity ratio of 200 percent compared with Company B's debt-toequity ratio of only 30 percent

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!