Aspero, inc. has sales of approximately $500,000 per year. Aspero requires a short-term loan of $100,000 to finance its working capital requirements. two banks are considering aspero's loan request but each bank requires certain minimum conditions be satisfied. bank america requires at least a 25% gross margin on sales, and bank boston requires a 2:1 current ratio. the following information is available for aspero for the current year:
- sales returns and allowances are 10% of sales
- purchases returns and allowances are 2% of purchases
- sales discounts are 2% of sales
- purchase discounts are 1% of purchase
- ending inventory is $138,000
- cash is 10% of accounts receivable
- credit terms to aspero's customers are 45 days
- credit terms aspero receives from its suppliers are 90 days
- purchases for the year are $400,000
- ending inventory is 38% greater than beginning inventory
- accounts payable are the only current liability
Access whether aspero, inc. meets the credit constraint for a loan from either or both banks. show computations.