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anonymous
 3 years ago
Company A has current assets of $42 billion and current liabilities of $31 billion.
Company B has current assets of $2.7 billion and current liabilities of $1.8 billion.
Which of the following statements is correct, based on this information? (Points : 1)
Company A is less likely than Company B to have sufficient working capital to meet its shortterm needs.
Company A has greater leverage than Company B.
Company A has less leverage than Company B.
Company A and Company B have roughly equivalent enterprise values
anonymous
 3 years ago
Company A has current assets of $42 billion and current liabilities of $31 billion. Company B has current assets of $2.7 billion and current liabilities of $1.8 billion. Which of the following statements is correct, based on this information? (Points : 1) Company A is less likely than Company B to have sufficient working capital to meet its shortterm needs. Company A has greater leverage than Company B. Company A has less leverage than Company B. Company A and Company B have roughly equivalent enterprise values

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anonymous
 3 years ago
Best ResponseYou've already chosen the best response.0I would go with option 2 This is because, company A has more current assets than current liabilities, and so it would have sufficient working capital to meet its shortterm needs. It's borrowing more than company B, so therefore has more leverage. And company A seems to be earning more than Comany B, but you can't tell by just current assets and liablities alone.
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