Potential changes in sales prices, fixed operating costs and/or variable costs should be taken into account when using breakeven analysis. Question 1 options: True False Question 2 (10 points) Listen All else equal, excess capacity means that more external financing is required to support increases in sales than would be needed if the firm previously operated full capacity. Question 2 options: True False Question 3 (10 points) Listen The inventory turnover and current ratios are related. The combination of a high current ratio and a low inventory turnover ratio relative to the industry norm might indicate that the firm is maintaining too high an inventory level or that part of the inventory is obsolete or damaged. Question 3 options: True False