2. Liquidity ratios A liquid asset can be converted to cash quickly without significantly impacting the asset's value. Which of the following asset classes is generally considered to be the most liquid? Cash Inventories Accounts receivable The most recent data from the annual balance sheets of N&B Equipment Company and Scramouche Opera Company are as follows: Balance Sheet December 31" (Millions of dollars) Scramouche Opera N&B Equipment Scramouche Opera Company Company Company Liabilities N&B Equipment Company Assets Current liabilities Current assets $553 $861 Cash Accounts payable Accruals 203 315 Accounts NAB Equipment Company Assets Current assets Balance Sheet December 31"(Millions of dollars) Scramouche Opera NAB Equipment Scramouche Opera Company Company Company Liabilities Current liabilities $861 $553 Accounts payable 315 203 Accruals Cash 190 Accounts receivable Inventories 594 924 2,100 1.075 1,265 1,012 1,012 Total current 1,350 assets Notes payable Total current liabilities Long-term bonds Total debt Net fixed assets Net plant and 1,547 2,812 1,238 2.250 1,650 1,650 equipment 610 328 188 262 Common equity Common stock Retained earnings Total common equity Total liabilities and equity 938 750 Total assets 3,750 3.000 3.750 3,000 N&B Equipment Company's current ratio is , and its quick ratio is and its quick ratio is __ Scramouche Opera Company's current ratio is . Note: Round your values to four decimal places. Which of the following statements are true? Check all that apply. U N&B Equipment Company has less liquidity but also a greater reliance on outside cash flow to finance its short-term obligations than Scramouche Opera Company. If a company's current liabilities are increasing faster than its current assets, the company's liquidity position is weakening. An increase in the quick ratio over time usually means that the company's liquidity position is improving and that the company is managing its short-term assets well. N&B Equipment Company has a better ability to meet its short-term liabilities than Scramouche Opera Company An increase in the current ratio over time always means that the company's liquidity position is improving