Reference no: EM132728975

You are an accounts payable manager at Tiptop Sellers, which is a medium size department store. The company is having liquidity issues and needs to free up cash for expansion projects. You have come across the Wall Street Journal article entitled, "Delaying Payments to Suppliers Helps Companies Unlock Cash". The article gives you some ideas for increasing liquidity, but you need to do more industry analysis. To help you understand liquidity within the retail sector, your boss creates a dashboard visualization using financial data from largest the five retailers mentioned in the article.

Question 1.) Which of the following statement is true?

Option 1: Companies that had the largest sales revenue had the highest current ratio.

Option 2: There is no relationship between the amount of sales revenue and the value of the current ratio.

Option 3: Companies that had the lowest sales revenue had the lowest acid test ratio.

Option 4: Amazon has acceptable current ratio and acid test ratio values.

Question 2.) What can be concluded from the dashboard?

Option 1: Walmart's Other Current Assets can be used to pay its immediate debts.

Option 2: The retail sectors share a common quick ratio that can be used as an industry benchmark.

Option 3: The value of Cash & Equivalents is directly correlated with the company's total revenue.

Option 4: Walmart's creditors will have concern over Walmart's ability to pay.