36. The most common measure of short-term liquidity is the a. acid-test. b. current ratio. c. quick ratio. d. working capital. 37. The acid-test is calculated as Cash + Cash Equivalents + Accounts Receivable Current Liabilities Cash + Cash Equivalents + Inventory + Accounts Receivable Current Liabilities Cash + Cash Equivalents + Accounts Receivable Current Assets Cash + Cash Equivalents + Inventory + Accounts Receivable Current Assets 38. A high inventory turnover might signal a. a problem with old and obsolete inventory. b. an overstock of inventory. c. poor inventory management. d. credit terms that are too tight. 39. A low inventory turnover might signal a. a problem with old and obsolete inventory. b. fast-moving inventory. c. too much inventory. d. not enough inventory on hand. 40. Which of the following is not an advantage of a company using equity rather than debt to finance a project? a. Interest requires more cash than does paying dividends. b. Dividends do not need to be paid. c. Equity does not need to be repaid whereas debt does. d. Interest is tax deductible