Compare The Gap Inc. (MBA 3-6) and American Eagle Outfitters Inc. (MBA 3-7) liquidity positions for Year 2. Comment on the differences.

Data from MBA 3-6

The Gap Inc. (GPS) operates specialty retail stores under such brand names as GAP, Old Navy, and Banana Republic. The following asset and liability data (in millions) were adapted from recent financial statements.

Data from MBA 3-7

American Eagle Outfitters Inc. (AEO) operates specialty retail stores, selling clothing such as denim, sweaters, t-shirts, and fleece outerwear that targets 15-to-25-year-old men and women. The following asset and liability data (in millions) were adapted from recent financial statements.

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Year 2 Year 1 Current assets: Cash $1,783 $1,783 Accounts receivable 282 335 Inventory Prepaid and other current assets Total current assets 1,997 1,830 506 $4,568 $2,461 367 $4,315 $2,453 Total current liabilities