The Company's Leverage Ratio Has Moved from 15

Multiple Choice

The company's leverage ratio has moved from 15.2% to 32%. Its return on equity ratio has also moved up, from 20.5% to 45.3%. Its times interest earned ratio has dropped to 3.5. Which of the following is the best statement to describe the company?

A) Is not in a risky financial position
B) Is depending on debt to finance its expansion
C) Cannot pay the interest on its long-term debt
D) Is depending on equity to finance its expansion
E) Has a sizable cushion to pay the interest on its debt