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How much can Nelson short-term debt increase

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Question - The Nelson Company has $1,650,000 in current assets and $550,000 in current liabilities. Its initial inventory level is $425,000, and it will raise funds as additional notes payable and use them to increase inventory. How much can Nelson's short-term debt (notes payable) increase without pushing its current ratio below 2.0? What will be the firm's quick ratio after Nelson has raised the maximum amount of short-term funds?

Reference no: EM133075641

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