Determine what will firm quick ratio after nelson has raised

Assignment Help Managerial Accounting

Reference no: EM132649768

Current and Quick Ratios

The Nelson Company has $1,175,000 in current assets and $470,000 in current liabilities. Its initial inventory level is $305,000, and it will raise funds as additional notes payable and use them to increase inventory.

Question 1: How much can Nelson's short-term debt (notes payable) increase without pushing its current ratio below 1.8? Do not round intermediate calculations. Round answer to the nearest dollar. _____ $

Question 2: What will be the firm's quick ratio after Nelson has raised the maximum amount of short-term funds? Do not round intermediate calculations. Round answer to two decimal places.

Reference no: EM132649768

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