Green Horizons Energy Co. is in its third year of operations, and the company has...
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Green Horizons Energy Co. is in its third year of operations, and the company has grown. To expand the business, Green Horizons borrowed $15 million from Bank of Ravenna. As a condition for making this loan, the bank required that Green Horizons maintain a current ratio of at least 1.50 and a debt ratio of no more than 0.50. Business recently has been worse than expected. Expenses have brought the current ratio down to 1.47 and the debt ratio up to 0.51 at December 15. Dana McCoy, the general manager, is considering the result of reporting this current ratio to the bank. McCoy is considering recording this year some revenue on account that Green Horizons will earn next year. The contract for this job has been signed, and Green Horizons will deliver the natural gas during January of next year.
1) Propose an ethical course of action for Green Horizons.
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