1.All of the following will worsen a firm's liquidity position except

a. increase days inventory outstanding

b. increase the average collection period.

c. increase accounts receivable turnover

d. decrease inventory turnover.

2. Which of the following statements concerning net income is most correct

a. Net income represents cash available to pay dividends.

b. Negative net income reduces a company's cash balance.

c. Net income represents income that may be reinvested in the firm or distributed to its owners.