Bauman Company’s total current assets, total current liabilities, and inventory for each of the past 4 years follow:

a. Calculate the firm’s current and quick ratios for each year. Compare the resulting time series for these measures of liquidity.
b. Comment on the firm’s liquidity over the 2016–2017 period.
c. If you were told that Bauman Company’s inventory turnover for each year in the 2016–2019 period and the industry averages were as follows, would this information support or conflict with your evaluation in part b? Why?

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2016 Item 2017 2018 2019 $22,500 Total current assets Total current liabilities $16,950 9,000 $21,900 $27,000 12,600 12,600 17,400 6,000 6,900 Inventory 6,900 7,200 Inventory turnover 2016 2017 2018 2019 Bauman Company Industry average 6.3 6.4 6.8 7.0 10.6 10.8 11.2 11.0