At the End of Last Year, a Firm Had a Current

Multiple Choice

At the end of last year, a firm had a current ratio of 1.4, net fixed assets of $2,500, notes payable of $0, and total assets of $5,100. Based on pro forma sales, current liabilities will increase by $500 and current assets will increase by $900. By how much can notes payable increase on the pro forma statement without changing the current ratio?

A) $0
B) $143
C) $400
D) $667
E) $760