uuesnon 4/ (1.06 points) Lu Ace Company is a retail store. Due to competition, it is having trouble selling its products. Thus, inventory has been building up. Ace's current ratio has not changed for the past three years, in spite of the inventory build up. Which of the following statements is true? 1) As long as the current ratio remains constant, there is no need for concern. 2) The composition of current assets and current liabilities does not matter. a The management of Ace should consider the effect of slow moving inventory on its 3) liquidity 4 Since inventory is a current asset, any increases should automatically cause the current ratio to rise Save Question 48 (1.66 points) How can a company improve its current ratio? 1) Work with a creditor to reclassify some current debt into long-term debt 2) Use cash to reduce current liabilities 3) Nothing can ethically be done to improve the current ratio 4) Use excess cash to buy new equipment