Selected financial data for Shumway Ltd. are shown below.

(a) Calculate for each of 2015 and 2014 the
(1) Current ratio,
(2) Receivables turnover ratio,
(3) Inventory turnover ratio.
(b) Based on these ratios, what conclusion(s) can be drawn about the company's liquidity?

2015 2014 Accounts receivable (gross)850,000 1,020,000 2,100,000 1,000,000 6,420,000 4,540,000 750,000 980,000 2,000,000 1,100,000 6,240,000 650,000 840,000 Merchandise inventory Total current assets Total current liabilities Net credit sales Cost of goods sold 1,250,000 5,430,000 3,950,000