Q4: The following liquidity ratios are available for two Auto Body Shop ( 10 marks)

	Amritpal Autos	Mohinder Motors
Current Ratio	1:2:1	1:4:1
Acid- Test Ratio	1:0:1	0:8:1
Receivable turnover	52 times	73 times
Inventory Turnover	40 times	26 times

I: Calculate the collection period, days, sales in inventory and operating cycle for each company

(3 marks)

ii) Indicate which company has the better result for each of the ratios provided above.

( 4 marks)

iii) Overall,, which of the two companies is more liquid ?

Explain ( 3 marks)