How much additional shortterm financing can company borrow

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Reference no: EM131487971

Question: (Evaluating liquidity) Blackberry Co. has experienced some difficulties financing its short-term expansion plans for its business. Blackberry Co. financed the construction of a new warehouse with a long-term loan from a bank. As a condition to obtain the loan, Blackberry agreed to maintain a current ratio of at least 2.0. At present, it has current assets at the level of $750,000 and a current ratio of 2.5. How much additional shortterm financing can the company borrow in order to finance its increasing sales, before its current ratio target is reached?

Reference no: EM131487971

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