1. Net working capital, working capital balances, and the current ratio Alled Biscuit Company's Chief Financial Officer (CFO) has decided to take a closer look at the firm's short-term asse and liabilities. ABC's balance sheet follows Allied Biscuit company (ABC) Balance Sheet Accounts payable Accruals Notes payable Total current liabilities Long-term debt $3,570,000 2,231,250 3,123,750 $8,925,000 16,575,000 $25,500,000 5,100,000 11,900,000 $17,000,000 $42,500,000 Cash Accounts receivable Inventory Total current assets $1,487,500 5,206,250 8,181,250 $14,875,000 Total debt Common equity Retained earnings Net plant and equipment 27,625,000 Total equity Total liabilities and equity Total assets $42,500,000 What is ABC's current ratio? What is the value of ABC's net working capital? O 4.75 times O 0.21 times O 0.58 times 167 times O $8,925,000 $5,950,000 O $42,500,000 O $14,875,000 Assume that ABC decides to purchase additional warehouse space costing $828,750 using long-term debt capital Given the condition of the company noted in the balance sheet, this activity should be expected to cause ABC's current ratio to decrease stay the same increase