Homework Answers
Current ratio=current assets/current liabilities
Hence current assets=(17*1.9)=$32.3 million
Current assets=cash+accounts receivable+inventory
Cash and accounts receivable make up =(20+40)=60% of current assets
Hence inventory is =(100-60)=40% of current assets
Hence value of inventory=(32.3*40%)
=$12.92 million.
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