Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The management of Tyron Inc. is contemplating changing it inventory policy. Right now, Tyron Inc. has $ 3 1 , 0 0 0 in current

The management of Tyron Inc. is contemplating changing it inventory policy. Right now, Tyron Inc. has $31,000 in current assets and $22,000 in current liabilities and its initial inventory level is $8,000. Tyron Inc. wants to rise funds as additional notes payable and use them to increase inventory but whatever funds they raise and invest them in inventory, they must make sure their new current ratio stay above 1.10 in order to maintain their credit rating. Giving this, what is the maximum new level of inventory for Tyron (so that they do not go below a current ratio of 1.10?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

A Fast And Frugal Finance

Authors: William P. Forbes, Aloysius Igboekwu, Shabnam Mousavi

1st Edition

0128124954, 978-0128124956

More Books

Students also viewed these Finance questions

Question

What is the cerebrum?

Answered: 1 week ago

Question

1. What are the pros and cons of diversity for an organisation?

Answered: 1 week ago

Question

1. Explain the concept of diversity and equality in the workplace.

Answered: 1 week ago