The following selected liquidity and solvency ratios are available for two companies operating in the petroleum industry:

Instructions
Assume that you are the credit manager of the local bank. Answer the following questions, using relevant ratios to justify your answer.
(a) Both Petro-Zoom and Sun-Oil have applied for a short-term loan from your bank. Which of the two companies is more liquid and should get more consideration for a short-term loan? Explain.
(b) Both Petro-Zoom and Sun-Oil have applied for a long-term loan from your bank. Are you concerned about the solvency of either company? Explain why or why not.