Companies a and b have the same total assets, sales, operating costs, and tax rates, and they pay the same interest rate on their debt. however, company a has a higher debt ratio. which of the following statements is incorrect? a. both companies have the same bep ratio. b. given this information, company b must have the higher roe. c. given this information, company a must have the higher roe.

c. Given this information, Company A must have the higher ROE.

Explanation:

ROE = Net income/Total assets. Interest expense is higher for Company A, hence its net income is lower than Company B's. Therefore, ROE of A < ROE of B

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"we first find value of tax in dollars.

the difference between the two prices   is: 23. 54 - 22 = 1.54

therefore the sales tax in dollars is 1.54

the tax % will be   (amount of tax / original cost price ) × 100

(1.54 / 22) × 100  → (0.07) × 100 =   7

so the tax rate is 7%

we can double check the answer.

7 % of 22   → (7/100) × 22 → 0.07 × 22 = 1.54

22 + 1.54 = 23.54"

answer; commerce clearing house;