You are a Supplier: A retailer requests to purchase supplies on credit from your company. You have no prior experience with this retailer. The retailers current ratio is 2.1, its acid-test ratio is 0.5, and inventory makes up most of its current assets. Do you extend credit?

You are the Financial Officer: Your company has a 36% gross margin ratio and a 17% net profit margin ratio. Industry averages are 44% for gross margin and 16% for net profit margin. Do these comparative results concern you?