Bottoms Up Corporation Has Current Assets of $90,000,total Assets of $210,000,current

question 21

Essay

Bottoms Up Corporation has current assets of $90,000,total assets of $210,000,current liabilities of $50,000,and total liabilities of $57,500.The company is trying to obtain a bank loan for $20,000 which would be financed over six months.The terms of the loan agreement specify that the company's current ratio cannot fall below 1.5.Calculate the current ratio before and after the loan.Do you think the loan will be granted?

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Definitions:

Polarity

A property of molecules with distinct oppositely charged ends, resulting from an uneven distribution of electrons.

Solvents

Substances that dissolve a solute, resulting in a solution; usually liquid but can be gas or solid.

Polarity

A characteristic of molecules with uneven distribution of charges, resulting in regions of partial positive and negative charges.

Polar

A molecule with uneven distribution of charges, leading to positive and negative ends, affecting solubility and melting/boiling points.