Jacob Inc has the following:

2014 2015 2016

Total Assets 100 110 120

Current Liabilities 10 10 10

Current Ratio 1 2 3

Quick Ratio 1 2 3

Cash Ratio .5 1.5 2.5

Debt/Equity Ratio 1 1.2 1.4

Assume current assets = cash, receivables and cash.

Based on the above information, Jacob Inc has been able to increase its Current Ratio, Quick Ratio and Cash Ratio over the three years. Please explain how it was able to do so? In other words, what is driving the numbers?

It was able to ______________________ its __________________ and put it into _____________________.

1. Increase, long-term debt, cash
2. Increase, sales, receivables
3. Increase, long-term debt, inventory
4. Decrease, long-term debt, cash
5. Decrease, short-term debt, cash
6. Increase, net income, inventory