Finance Questions? Ask a Financial Expert for Answers ASAP
The question here is incomplete. You have not stated the statements out of which you are asking which one is correct.
However, I have this textbook and I presume the choices are the following:
The two companies have the same times interest earned (TIE) ratio. Firm L has a lower ROA than Firm U. Firm L has a lower ROE than Firm U. Firm L has the higher times interest earned (TIE) ratio. Firm L has a higher EBIT than Firm U.
Out of these, the correct statement is ::
Firm L has a lower ROA than Firm U
I hope this helps...