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To satisfy his bank's loan restrictions, Ian must maintain a current ratio of 2.0 or more. At this time, his current assets are $67,500, his total assets are $123,500, his current liabilities are $28,500, and his total debt is $56,500. Is he satisfying the bank's requirements

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huntermunsell186
To determine if Ian is satisfying the bank's loan restrictions, we need to calculate the current ratio. The current ratio is calculated by dividing the current assets by the current liabilities.

Ian's current assets: $67,500
Ian's current liabilities: $28,500

Current Ratio = Current Assets / Current Liabilities
Current Ratio = $67,500 / $28,500
Current Ratio ≈ 2.37

Ian has a current ratio of approximately 2.37, which means he has $2.37 in current assets for every $1 of current liabilities.

Because the bank requires Ian to maintain a current ratio of 2.0 or more and Ian's current ratio is 2.37, he is satisfying the bank's loan restriction requirements.

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