Mukhopadhya Network Associates has a current ratio of 1.60, where the current ratio is defined as follows:
Question:
Mukhopadhya Network Associates has a current ratio of 1.60, where the current ratio is defined as follows: current ratio current assets/current liabilities. The firms current assets are equal to $1,233,265, its accounts payables are $419,357, and its notes payables are $351,663. Its inventory is currently at $721,599. The company plans to raise funds in the short-term debt market and invest the entire amount in additional inventory. How much can notes payable increase without the current ratio falling below 1.50?
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Let x be the amount raised through notes payables New current liabili...View the full answer
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Related Book For 
Fundamentals of corporate finance
ISBN: 978-0470876442
2nd Edition
Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates
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