Make-ThemCorporation Consolidated Balance Sheet (in thousands except share data) Fiscal Year Ended Current assets: Cash and...

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Make-ThemCorporation Consolidated Balance Sheet (in thousands except share data) Fiscal Year Ended Current assets: Cash and cash equivalents Dec. 31, 2008 Dec. 31, 2007 ASSETS $ 369 58 Accounts receivable, net Inventories Prepaid expenses and other current assets 489 107 Deferred income taxes, net 43 Total current assets 1,066 Property, plant and equipment, net 5,137 Other assets 1,168 TOTAL ASSETS $ 7,371 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 429 Accrued compensation and related costs 104 Accrued taxes 132 Current portion of long-term debt 89 Total current liabilities 754 Long-term debt 2,630 Total liabilities 3,384 Shareholders' equity: Common stock ($0.1 par value)-authorized, : 4,000,000 shares; issued and outstanding, 3,500,000. 350 Paid-in capital in excess of par 2,415 Retained earnings 1,222 350 2,415 241 Total shareholders' equity 3,987 3,006 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 7,371 $ 6,198 Assume the following information for both years: Net Profit Margin (NPM) was 4%. Interest rate on Long-term Debt 10% Times-Interest-earned was 5 times All of the Net Income was retained and Market price for each share of common stock was as follows: January 1, 2008 - $1.25; December 31, 2008 - $1.14; January 1, 2007- $1.10; December 31, 2007 - $0.86 a. Use Altman Z-Score to decide whether or not you would lend five million dollars to the above- mentioned company. Show all calculations supporting your conclusion. Make-ThemCorporation Consolidated Balance Sheet (in thousands except share data) Fiscal Year Ended Current assets: Cash and cash equivalents Dec. 31, 2008 Dec. 31, 2007 ASSETS $ 369 58 Accounts receivable, net Inventories Prepaid expenses and other current assets 489 107 Deferred income taxes, net 43 Total current assets 1,066 Property, plant and equipment, net 5,137 Other assets 1,168 TOTAL ASSETS $ 7,371 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 429 Accrued compensation and related costs 104 Accrued taxes 132 Current portion of long-term debt 89 Total current liabilities 754 Long-term debt 2,630 Total liabilities 3,384 Shareholders' equity: Common stock ($0.1 par value)-authorized, : 4,000,000 shares; issued and outstanding, 3,500,000. 350 Paid-in capital in excess of par 2,415 Retained earnings 1,222 350 2,415 241 Total shareholders' equity 3,987 3,006 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 7,371 $ 6,198 Assume the following information for both years: Net Profit Margin (NPM) was 4%. Interest rate on Long-term Debt 10% Times-Interest-earned was 5 times All of the Net Income was retained and Market price for each share of common stock was as follows: January 1, 2008 - $1.25; December 31, 2008 - $1.14; January 1, 2007- $1.10; December 31, 2007 - $0.86 a. Use Altman Z-Score to decide whether or not you would lend five million dollars to the above- mentioned company. Show all calculations supporting your conclusion.