The following selected ratios are available for a recent year for Archers Post Limited and Nyarboro Corporation:

Instructions
(a) Which company is more liquid? Explain.
(b) Which company is more solvent? Explain.
(c) Which company is more profitable? Explain.
(d) Which company do investors favour? Is this consistent with your findings in parts (a) to (c)? Investors would be more interested in buying the shares of which company?

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PostNarboro Industry Average Receivables turnover 8 7 10.4 times 29.9 times 65.3 times Times interest earned 4.1 times 3.4 times 3.6 times 2 Return on assets Return on common shareholders' equity Price-earnings ratio 13.8 times 20.6 times 26.5 times