The Manager in Charge of the audit of Miramar Company needs a presentation to train the junior-level auditors recently assigned to the engagement. You are now a senior-level auditor with coordination and review responsibilities, and the manager asked for your cooperation. The summary of the financial information for the last four years follows:

Item	2022	2021	2020	2019
Total Current Assets	$156,900	$219,300	$255,00	$265,00
Total Current Liabilities	95,000	126,000	128,000	174,000
Inventory	65,000	69,000	70,000	72,000

The presentation s hould include the following:

1. A definition of an analytical procedure (AP).

2. When the AP may be performed.

3. What AP applies to the portion of financial information of Miramar Company?

4. Describe the short-term debt-paying ability and explain why the ratios are helpful to auditors.

5. Present the results based on financial ratios that apply.