Airspot Motors, Inc. has $2,145,000 in current assets and $858,000 in current liabilities. The companys managers want
Question:
Airspot Motors, Inc. has $2,145,000 in current assets and $858,000 in current liabilities. The company’s managers want to increase the firm’s inventory, which will be financed using short-term debt. How can the firm increase its inventory without its current ratio falling below 2.0 (assuming all other current assets and current liabilities remain constant)?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 62% (16 reviews)
Airspot Motors now has a current ratio of 25 If the firm wants to use shortterm debt a current ...View the full answer
Answered By
PALASH JHANWAR
I am a Chartered Accountant with AIR 45 in CA - IPCC. I am a Merit Holder ( B.Com ). The following is my educational details.
PLEASE ACCESS MY RESUME FROM THE FOLLOWING LINK: https://drive.google.com/file/d/1hYR1uch-ff6MRC_cDB07K6VqY9kQ3SFL/view?usp=sharing
3.80+
3+ Reviews
10+ Question Solved
Related Book For
Financial Management Principles and Applications
ISBN: 978-0133423822
12th edition
Authors: Sheridan Titman, Arthur Keown, John Martin
Question Posted:
Students also viewed these Finance questions
-
The Nelson Company has $1,812,500 in current assets and $625,000 in current liabilities. Its initial inventory level is $437,500, and it will raise funds as additional notes payable and use them to...
-
The Nelson Company has $1,312,500 in current assets and $525,000 in current liabilities. Its initial inventory level is $375,000, and it will raise funds as additional notes payable and use them to...
-
The Petry Company has $1,312,500 in current assets and $525,000 in current liabilities. Its initial inventory level is $375,000, and it will raise funds as additional notes payable and use them to...
-
The trial balance for Hanna Resort Limited on August 31 is as follows: Additional information: 1. The balance in Prepaid Insurance includes the cost of four months premiums for an insurance policy...
-
Repeat Exercise 3, using in Step 4 of Algorithm 12.4 the approximation wi,1 = wi,0 + kg(xi), for each i = 1, . . . ,m 1. Repeat exercise 3
-
a. Show that v1, v2, v3 are eigenvectors of A. b. Let x0 be any vector in R3 with nonnegative entries whose sum is 1. (In Section 4.9, x0 was called a probability vector.) Explain why there are...
-
What are the seven skills that a CIO needs to help improve business-IT alignment?
-
Power Drive Corporation designs and produces a line of golf equipment and golf apparel. Power Drive has 100,000 shares of common stock outstanding as of the beginning of 2015. Power Drive has the...
-
The four people below have the following investments. Invested Interest Amount Rate Jerry Elaine $13,000 12% 16,000 6 Compounding Quarterly Semiannually George 23,000 8 Annually Kramer 19,000 10...
-
The St. Lucia Blood Bank, a private charity partly supported by government grants, is located on the Caribbean island of St. Lucia. The blood bank has just finished its operations for September,...
-
The S&H Construction Company expects to have total sales next year totaling $15,000,000. In addition, the firm pays taxes at 35 percent and will owe $300,000 in interest expense. Based on last years...
-
The King Carpet Company has $3,000,000 in cash and a total of $12,000,000 in current assets. The firms current liabilities equal $6,000,000 such that the firms current ratio equals 2. The companys...
-
A certain industrial machine depreciates so that its value after t years becomes Q(t) = 20,000e 0.4t dollars. a. At what rate is the value of the machine changing with respect to time after 5 years?...
-
What rhetorical aspects or factors do you think are unique to your particular culture? What rhetorical aspects or factors do you think are commonly used across multiple cultures?
-
Go to the web page for a securities broker or mutual fund. Use a calculator provided there to indicate the following. Taxable Interest Rate 5% 5% 8% 8% Your Marginal Tax Rate 35% 15% 28% 33%...
-
Identify a particular forum that has both print and online versions in your culture (e.g., a newspaper). Next, review both the print and the online versions of this item to determine if you could use...
-
A new leader brought renewed enthusiasm to the Brunswick County Conference & Visitors Bureau (BCCVB), the official tourism promotion agency for Brunswick County, Pennsylvania. Under her leadership,...
-
Design a circuit with a 4-bit BCD input A, B, C, D that produces an output W, X, Y, Z that is equal to the input + 3 in binary. For example, 9 (1001) + 3 (0011) = 12 (1100). The outputs for invalid...
-
When is it reasonable to rely on criminal profiling to help solve a crime? When is it counterproductive?
-
Swifty company is a publicly held corporation whose $1 par value stock is actively traded at $30 per share. The company issued 3400 shares of stock to acquire land recently advertised at $93000. When...
-
Consider a standard Poisson process \(\left(N_{t} ight)_{t \in \mathbb{R}_{+}}\)with intensity \(\lambda>0\) under a probability measure \(\mathbb{P}\). Let \(\left(S_{t} ight)_{t \in...
-
In the Payday Loans feature on page 129, we examined these short-term, high-interest loans. Go to the Responsible Lending Organization website at www.responsiblelending.org/payday-lending/. What are...
-
In early 2016, typical terms on a payday loan involved a $15 charge for a two-week payday loan of $100. Assuming there are 26 fourteen-day periods in a year, what is the effective annual rate on such...
-
How do you calculate the future value of an annuity?
-
A scuba diver is exploring a shipwreck at a depth of 30 meters in the ocean. The diver's tank contains 5.0 moles of compressed air at a temperature of 25C. What is the pressure of the air in the tank...
-
1. Determine the atmospheric pressure at a location where the barometric reading is 720 mm Hg. 2. A pressure gauge connected to a tank reads 52 psi at a location where the barometric reading is 29.6...
-
Assume that a bond has an annual coupon rate of 6.80 percent, but makes coupon payments on a semi-annual basis, has a par value of $1,000, a yield to maturity of 7.20 percent, and a current price of...
International Accounting And Multinational Enterprises 3rd Edition - ISBN: 9780471506348 - Free Book
Study smarter with the SolutionInn App