PROBLEM 1 (20 points) Given the follow set of ratios for December 31, 2019 and December 31, 2018, evaluate the results in regard to the short-term liquidity of the firm. Comment on each measure and its impact on Liquidity. Explain the possible reason for the change from the prior year and what has changed in the company's control of its current assets (namely AR and Inventory) to cause the ratios to be the way they are. 12.31.2019 12-31-2018 Working Capital Current Ratio Acid Test Ratio Accounts Receivable Turnover AR Turnover in Days Inventory Turnover Inventory Turnover in Days $175,000 2.3 0.77 15.25 25 5.85 85.75 $105,000 1.5 0.75 118 35 5.9 85 25