Response to the following questions:
1. Ace Industries has current assets equal to $3 million. The company's current ratio is 1.5, and its quick ratio is 1.0. What is the firm's level of current liabilities? What is the firm's level of inventories?
2. Baker Brothers has a DSO of 40 days. The company's average daily sales are $20,000. What is the level of its accounts receivable? Assume there are 365 days in a year.