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Companies A and B are new companies (they were both founded a year ago) which...

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Finance

Companies A and B are new companies (they were both founded a year ago) which produce fashionable wool sweaters. The companies are very similar except that company A relies on faster and more expensive sewing machines, which save on labor costs. Company B spent less to acquire slower and less sophisticated machines, but it relies on many more employees than company A to operate the machines and do some stitching/sewing by hand. The companies otherwise produce similar numbers of sweaters at similar prices. Which of the following would most likely describe differences between the income statements of companies A and B? A. Company A will likely have higher profits (net income) than Company B. B. Company A will likely have higher depreciation expenditures than Company B. C. Company A will likely have lower revenues than Company B. D. Company A will likely have lower costs of goods sold (COGS) than Company B E. Answer choices A and C are both true regarding the companies differences. F. Answer choices B and D are both true regarding the companies differences

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