1. There are two firms, UNO Inc. and DOS Co., In the same industry. One of the firms, UNO, has a higher and increasing current ratio UNO also has a low and falling inventory turnover and a very high and increasing average collection period. (Note: DOS has a stable current ratio and inventory turnover, and long but stable average collection period). Both firms have very little cash. The data for UNO and DOS can be summarized as: Company Current Ratio Inventory Turnover Cash Ave. Collection Period Very long increasing Long: Stable UNO Low and falling Higher Increasing Lower, stable little DOS Higher little Which of the following statements about the relative liquidity of the firms is most plausable? ODOS has better liquidity because the current ratio is more stable DUNO has better liquidity because of better inventory management UNO has lower liquidity as the higher current ratio likely results from the build up of low quality current assets DOS has lower liquidity because the higher inventory turnover ratio likely means the firm is holding unsalable inventory DUNO has better liquidity as evidenced by the higher current ratio