Ernie's Mufflers has current liabilities of $45 million. Cash makes up 5 percent of the current assets and accounts receivable makes up another 50 percent of current assets. Ernie's current ratio = 1.5 times. What is the value of inventory listed on the firm's balance sheet?
- $20.25 m
- $33.75 m
- $30.375 m
- $13.75 m
Note: Provide support for rationale.