Analysis of Financial Statements: Liquidity Ratios Liquidity ratios are used to measure a firm's ability to meet its obligations as they come due. Two of the most commonly used liquidity ratios are the: (1) Current ratio and (2) Quick, or acid test, ratio. The current ratio is the most commonly used measure of solvency. Its equation is: If a firm is having financial difficulty, it typically begins to pay its accounts payable more slowly and to borrow from the bank, both of which will increase its current causing a decline in the current ratio. The quick ratio is a measure of a firm's ability to pay off obligations without relying on the sale of , which are typically the least liquid of a firm's current assets. Its equation is:

Ardmore farm and seed has an inventory dilemma. they have been selling a brand of very popular insect spray for the past year. they have never really analyzed the costs incurred from ordering and holding the inventory and currently fave a large stock of the insecticide in the warehouse. they estimate that it costs $25 to place an order, and it costs $0.25 per gallon to hold the spray. the annual requirements total 80,000 gallons for a 365 day year.a. assuming that 10,000 gallons are ordered each time an order is placed, estimate the annual inventory costs.b. calculate the eoq.c. given the eoq calculated in part b., how many orders should be placed and what is the average inventory balance? d. if it takes seven days to receive an order from suppliers, at what inventory level should ardmore place another order?

Suppose there are three types of consumers who attend concerts at your university’s performing arts center: students, staff, and faculty. each of these groups has a different willingness to pay for tickets; within each group, willingness to pay is identical. there is a fixed cost of $1,000 to put on a concert, but there are essentially no variable costs. for each concert: i. there are 140 students willing to pay $20. (ii) there are 200 staff members willing to pay $35. (iii) there are 100 faculty members willing to pay $50. a) if the performing arts center can charge only one price, what price should it charge? what are profits at this price? b) if the performing arts center can price discriminate and charge two prices, one for students and another for faculty/staff, what are its profits? c) if the performing arts center can perfectly price discriminate and charge students, staff, and faculty three separate prices, what are its profits?

Statistical process control charts: a. indicate to the operator the true quality of material leaving the process. b. display upper and lower limits for process variables or attributes and signal when a process is no longer in control. c. indicate to the process operator the average outgoing quality of each lot. d. display the measurements on every item being produced. e. are a graphic way of classifying problems by their level of importance, often referred to as the 80-20 rule.