You are the Senior Credit Officer at your bank. Miss James, your Junior Credit Officer, has presented the following projected data for 2019 supplied by The Mosely Corporation. She has asked for assistance in completing the statement of financial position. The Mosely Corporation has applied for a loan to start a project that you will eventually make the credit decision on. Mosely's actual sales for 2018 were $2,400,000. your The bank's lending policy requires that a borrower's financial position must show equity of at least 20% in order to attract the bank's funding. (a) Use the data to complete the statement of financial position for 2019
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- Snowflake Manufacturing [SM] has recently come to the bank you work for looking for a $280,000 long-term loan. The following data was submitted with SM's loan application: 2020 $475,200 155,400 175,200 408,600 103,500 13,200 34,200 56,100 64,200 2019 $316,500 120,000 2021 $820,800 Current assets.. Current liabilities. Non-current liabilities. Shareholders' equity.. Operating income... Interest expense... Income tax expense.. Net income... 414,600 60,800 303,700 168,900 7,200 65,400 96,300 106,300 300,000 490,200 208,500 28,500 72,000 108,000 115,000 Operating cash flow... The loan committee has asked you to analyze the data using at least three relevant financial ratios and complete a brief trend analysis. They would also like you to briefly discuss any limitations that might exist when completing this type of analysis and what data dashboards can do to help this. Finally, they have asked that your report also contain a recommendation about whether SM's loan request should be approved.…You are a credit analyst of a growing commercial bank and have recently received loan applications from two companies of relatively similar size. Show below are selected financial data for these two applicants at the end of the current year: RED CO BLUE CO. Net credit sales P700.000.00 P650,000.00 Cost of goods sold P500,000.00 P490,000.00 Cash P60,000.00 P20,000.00 Accounts receivable (net) P77,000.00 P60,000.00 Inventory P94,000.00 P180,000.00 Current liabilities P11000.00 P105,000.00 Assume that the year-end balances for accounts receivable and for inventory approximate the average balances of these items throughout the year. A. Compute the following on BLUE 1. Working capital 2. Current ratio 3. Acid test ratioYou are a credit analyst of a growing commercial bank and have recently received loan applications from two companies of relatively similar size. Show below are selected financial data for these two applicants at the end of the current year: RED CO BLUE CO. Net credit sales P700,000.00 P650,000.00 Cost of goods sold P500,000.00 P490,000.00 Cash P60,000.00 P20,000.00 Accounts receivable (net) P77,000.00 P60,000.00 Inventory P94,000.00 P180,000.00 Current liabilities P110,p00.00 P105,000.00 Assume that the year-end balances for accounts receivable and for inventory approximate the average balances of these items throughout the year. A. Compute the following on BLUE 1. Inventory turnover 2. Days sales in inventory 3. Operating cycle
- You are a credit analyst of a growing commercial bank and have recently received loan applications from two companies of relatively similar size. Show below are selected financial data for these two applicants at the end of the current year: RED CO BLUE CO. P700,000.00 P650,000.00 Net credit sales Cost of goods sold P500,000.00 P490,000.00 Cash P60,000.00 P20,000.00 Accounts receivable (net) P77,000.00 P60,000.00 P94,000.00 P180,000.00 Inventory Current liabilities P110,D00.00 P105,000.00 Assume that the year-end balances for accounts receivable and for inventory approximate the average balances of these items throughout the year. A. Compute the following on RED 1. Working capital 2. Current ratio 3. Acid test ratio 4. Accounts receivable turnoverThe employee credit union at State University is planning the allocation of funds for the coming year. The credit union makes four types of loans to its members. In addition, the credit union invests in risk-free securities to stabilize income. The various revenue-producing investments together with annual rates of return are as follows. Type of Loan/Investment Automobile loans Furniture loans Other secured loans Signature loans Risk-free securities ● How should the $2,400,000 Automobile loans Furniture loans Other secured loans Signature loans Risk-free securities to LA The credit union will have $2,400,000 available for investment during the coming year. State laws and credit union policies impose the following restrictions on the composition of the loans and investments. LA Annual Rate of Return (%) • Risk-free securities may not exceed 30% of the total funds available for investment. Signature loans may not exceed 10% of the funds invested in all loans (automobile, furniture, other…The employee credit union at State University is planning the allocation of funds for the coming year. The credit union makes four types of loans to its members. In addition, the credit union invests in risk-free securities to stabilize income. The various revenue-producing investments, together with annual rates of return, are as follows. Type of Loan/Investment Automobile loans Furniture loans Other secured loans Signature loans Risk-free securities $ ● Automobile loans The credit union will have $2,400,000 available for investment during the ng year. State laws and credit union policies impose the following restrictions on the composition of the loans and investments. Furniture loans Other secured loans • Risk-free securities may not exceed 30% of the total funds available for investment. Signature loans may not exceed 10% of the funds invested in all loans (automobile, furniture, other secured, and signature loans). Signature loans Risk-free securities • Furniture loans plus other…
- Jassim is a Credit Officer with Riffa Bank and is working on structuring a loan facility for his client. The Bank uses Return on Net Funds Employed to price its loan: Bank policy dictates that loans must generate an 10%6 Rate of Return. Additional loan expenses on this facility will be BHD5,000. How much will Riffa Bank earn from a BHD300,000 loan for 1 year. O a. BHD 30,000 O b. BHD35,000 O C. BHD 40,000 O d. BHD 50,000You are finalizing a bank loan for $180,000 for your small business and the closing fees payable to the bank are 1.7% of the loan. After paying the fees, what will be the net amount of funds from the loan available to your business?Assume that your team is in business and you must borrow $6,000 cash for short-term needs. You have been shopping banks for a loan, and you have the following two options. A. Sign a $6,000, 90-day, 10% interest-bearing note dated June 1. B. Sign a $6,000, 120-day, 8% interest-bearing note dated June 1. Required 1. Discuss these two options and determine the better choice. Ensure that all teammates concur with the decision and understand the rationale. 2. Each member of the team is to prepare one of the following journal entries. a. Option A—at date of issuance. b. Option B—at date of issuance. c. Option A—at maturity date. d. Option B—at maturity date. 3. In rotation, each member is to explain to the team the entry he or she prepared in part 2. Ensure that all team members concur with and understand the entries. 4. Assume that the funds are borrowed on December 1 (instead of June 1) and your business operates on a calendar-year reporting period. Each member of the team is to prepare…
- You have just been hired as a loan officer at a national bank. Your first assignment is to calculate the amount of the periodic payment (in $) required to amortize (pay off) the following loan being considered by the bank (use Table 12-2). (Round your answer to the nearest cent.) LoanPayment PaymentPeriod Term ofLoan (years) NominalRate (%) Present Value(Amount of Loan) $ 2,582 every month 1 1 4 6 $30,000 loan payment wrong needs correctionMiss W deposited Php 5,000 in the bank last May 2019. In May 2020, she was notified that her money earned Php 500. Which of the following basic concepts of mathematical finance describes the amount Php 500? * a. Rate b. Principal c. InterestThe employee credit union at State University is planning the allocation of funds for the coming year. The credit union makes four types of loans to its members. In addition, the credit union invests in risk-free securities to stabilize income. The various revenue-producing investments together with annual rates of return are as follows: Type of Loan/Investment Annual Rate of Return (%) Automobile loans 9. Furniture loans 11 Other secured loans 12 Signature loans 13 Risk-free securities 10 The credit union will have $2.3 million alailable for investment during the coming year. State laws and credit union policies impose the following restrictions on the composition of the loans and investments: • Risk-free securities may not exceed 30% of the total funds available for investment. • Signature loans may not exceed 10% of the funds invested in all loans (automobile, furniture, other secured, and signature loans). • Furniture loans plus other secured loans may not exceed the automobile…