The current ratio (assets/liabilities) of company X is 2.9. Given that the current assets are $377000, find the current liabilities:

Current liabilities = 130000

The board of directors determines that the current ratio must never be below 2.6. What is the maximum amount that the company can borrow?

The maximum amount that the company X can borrow is $ 145,000

Step-by-step explanation:

1. Let's review the information given to us to answer the question correctly:

Current ratio of assets/liabilities = 2.9

Current assets = $ 377,000

Current liabilities = Currents assets/Ratio = 377,000/2.9 = $ 130,000

2. The board of directors determines that the current ratio must never be below 2.6. What is the maximum amount that the company can borrow?

Desired ratio of assets/liabilities = 2.6

Current assets = $ 377,000

Desired liabilities = $ Current assets/Ratio = 377,000/2.6 = $ 145,000

The maximum amount that the company X can borrow is $ 145,000