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What will happen to the? firm current? ratio

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Question - The King Carpet Company has $3,070,000 in cash and a total of $12,110,000 in current assets. The? firm's current liabilities equal $5,380,000 such that the? firm's current ratio equals 2.3.

The? company's managers want to reduce the? firm's cash holdings down to $1,150,000 by paying $556,000 in cash to expand the? firm's truck fleet and using $1,364,000 in cash to retire a? short-term note. If they carry this plan? through, what will happen to the? firm's current? ratio?

Reference no: EM133104888

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