Underwood Boutique reported the following financial data for 2017 and 2016.

Instructions
(a) Calculate the current ratio for Underwood Boutique for 2017 and 2016.
(b) Suppose that at the end of 2017, Underwood Boutique used $1.5 million cash to pay off $1.5 million of accounts payable. How would its current ratio change?
(c) At September 30, Underwood Boutique has an undrawn operating line of credit of $12.5 million. Would this affect any assessment that you might make of Underwood Boutique's short-term liquidity? Explain.

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UNDERWOOD BOUTIQUE Balance Sheet (partial) September 30 (in thousands) 2017 2016 Current assets Cash and short-term deposits Accounts receivable Inventories Other current assets 2,574 2,147 1,201 322 $1,021 1,575 1,010 192 $3.798 S6,244 $4,503 Total current assets Current liabilities $2,619