The following ratios are available for Ming Inc.

2017 2016 Current ratio 1.3:1 1.5:1 Accounts receivable turnover 12 times 10 times Inventory turnover 11 times 9 times Instructions

(a) Is Ming’s short-term liquidity improving or deteriorating in 2017? Be specifi c in your answer, referring to relevant ratios.

(b) Do changes in turnover ratios affect profi tability? Explain.

(c) Identify any steps Ming might have taken, or might wish to take, to improve its management of its accounts receivable and inventory turnovers.