(Liquidity Analysis)The King Carpet Company has

$3,120,000

in cash and a total of

$12,910,000

in current assets. The firm's current liabilities equal

$5,090,000

such that the firm's current ratio equals

2.5.

The company's managers want to reduce the firm's cash holdings down to

$1,020,000

by paying

$508,000

in cash to expand the firm's truck fleet and using

$1,592,000

in cash to retire a short-term note. If they carry this plan through, what will happen to the firm's current ratio?