Select the right answer from the following:

5. The current ratio for 2021 is (rounded):

1. 1.4 to 1
2. 2.0 to 1
3. 2.7 to 1
4. 3.4 to 1

6. The inventory turnover for 2021 is (rounded):

1. 2.61 times.
2. 3.94 times.
3. 3.17 times.
4. 3.51 times.

7. When assessing a companys credit risk, analysts

1. use only financial ratios.
2. use only the statement of cash flows.
3. review both liquidity and solvency.
4. look only at the operating and cash conversion cycles.

8. Which of the following actions is not an option for the lender when a borrower is in default?

1. Modify the debt payment schedule in exchange for an increased interest rate or additional collateral.
2. Adjust the loan payment schedule to better suit the companys anticipated operating cash flows.
3. Petition a court to judge the borrower insolvent.
4. Contact the borrowers customers and begin collecting their receivables.