Kendra Massey is trying to decide how to invest a recent windfall inheritance. Because she considers herself a fashionista, her first thought was to look at two of her favorite stores, Nordstrom and Macys. Kendra visited each companys website and calculated the following ratios based on the financial statements she found there. She also found some industry averages to use as a comparison.

Macys

Nordstrom

Industry Average

2015

2014

2015

2014

2015

2014

Current ratio

1.34

1.69

1.04

1.87

1.90

1.70

Acid-test ratio

0.29

0.53

0.27

1.12

0.50

0.60

Accounts receivable turnover

55.2 times

65.2 times

11.3 times

5.9 times

40.8 times

56.4 times

Average collection period

6.6 days

5.6 days

32.3 days

61.9 days

8.9 days

6.5 days

Inventory turnover

3.02 times

3.07 times

4.99 times

5.15 times

3.20 times

4.10 times

Average days to sell inventory

120.9 days

118.9 days

73.1 days

70.9 days

114.1 days

88.8 days

Which of the two companies has the stronger liquidity position?

How do the companies positions compare to the industry averages?